tv Politics Public Policy Today CSPAN September 10, 2012 8:00pm-1:00am EDT
this week when representatives of commodity crop groups, the american farm bureau, the american farmers union are going to be gathering in the u.s. capitol demanding action so that we can at least allow one sector the ability and the confidence to know that they have some future both short-term and long-term. and with that i'd yield back the balance of my time, mr. speaker. the speaker pro tempore: the gentleman yields the speaker pro tempore: under the speaker's announced policy of january 5, 2011, the gentlewoman from alabama, mrs. roby, is recognized for 60 minutes as the designee of the majority leader. mrs. roby: i appreciate the opportunity to be here this evening alongside with some of my colleagues, freshmen colleagues and we will have a frank discussion with the american people tonight about a milestone we hit just last week.
and this is the national debt just hit $16 trillion. this brings no pride or cause to celebrate to the american people. nor should it to any member of this body, our friends in the senate or in the white house either. that is approximately $51,000 for every man, woman and child in this country. it doesn't have to be this way. i want to point you to a few of the president's own words >> we can't afford to mortgage our children's future on another mountain of debt. where are we today?
today, we are at a place that is far worse than four years ago. not $15 trillion, but $16 trillion in debt later, we have not seen anything significant from this white house in an effort to reduce our debt. instead, all we hear is new programs that are going to require more taxpayer dollars and not an effort to ri -- rein this out-of-control spending. we want to focus on jobs. this is the number one issue facing the american people right now. we need to get america back to work. and this body right here, we don't recreate the jobs, but we could create an environment in which job creation is right. and we have done a lot here in the house. we have passed over 30 bills that are sitting in the senate
awaiting action. we are going to highlight what we have learned. and i would just say to you, mr. gardner, i'm sure you can say the same about what you learned over the district work period traveling from county to county in alabama's second district, the debt has stifled job creation because it has created uncertainty. all of the regulation and red tape that has been passed in the previous congress that this congress has been unable to do because of the lack of action in the senate, all of that has contributed, obamacare has contributed to moran more uncertainty. i have traveled around and folks can't take anymore. their businesses are on the
line. and that is a reflection of what's going to happen in their households. mr. gardner: the gentlelady is exactly right. thank you for your leadership on the economy and getting this country turned around and getting our businesses back in shape to higher once again. over the past couple of years since being elected, i have traveled over 65,000 miles to be in every nook and cranny of the district, eastern colorado, northern colorado. we have held 74 town hall meetings to make sure we are listening to shall everybody's voices and make sure they have a voice and make our economy grow and healthy once again. the points you talk about, i don't know that anything is more relevant in the conversations that we have today. and a point was made last week in jewelsburg, colorado.
when somebody said, a young lady raised her hand and said, i'm a single mom. i have three kids at home. i have had two jobs and only have one and i'm looking for a second one, but i can't make ends meet, because my job doesn't pay enough. energy prices continue to increase, trying to find health-care for her children. talk about somebody who is the front lines of our economy who is suffering, because the past 3 1/2 years of failed economic policies. the congressional budget office recently shoed a review of what could -- issued a review of what could happen to deal with the looming tax increases. and this is what the congressional budget office has stated. and i quote. in particular, large budget deficits and growing debt would
reduce national saving, leading to higher interest rates, more borrowing from abroad, and less domestic investment, which, in turn, would lower the growth of incomes in the united states. and so, while we talk about growing the economy and economic growth and the need to get businesses around this country hiring again, at the same time there is a negative pressure being place odd them because congress can't do its job to control spending. $16 trillion in debt. you mentioned it was nearly $51,000 for every man, woman and child. we have a 10-month-old, he owes $51,000 as a share of the federal debt. $51,000 a piece. and that negative pressure, that mounting debt, deficits that are over $1 trillion a year, makes it moran more difficult for businesses to have access to the
capital they need to grow and make it difficult for companies to operate because they find themselves competing with the federal government for those scares resources. next thing, the government will have to look at tax increases. and so the challenges our bases face, congress, can you get government out of the way so we can let america work and run our businesses the way we want to, not the way washington wants to. but at the same time, you have a congress, including the united states senate that hasn't passed a budget in the past 3 1/2 years. hasn't done a fundamental duty to do what it has to do and make sure it has to do. but they refuse to pass a budget. they refuse, make no mistake because they need more time or study it more or come up with a different bill, they refuse it
because they think it would be bad politically to vote on a budget. that's why the president's own budget received zero votes, not only zero republican votes, but democrat votes for the president's own budget. there are so many people across this country who are unemployed, who are looking for work. colleges just started -- most of the universities around the country just went back in a couple of weeks ago. the students, all looking for jobs and expecting jobs to deal with their student loans. and i know we have talked about it many times. mrs. roby: i think -- if we could spend some time on our young people, cuz, because that that really pains the picture better than anything. the graduating class of 2012, when they were getting ready to face the real world in april of
this year, the associated press reported that over -- or that half of those college graduates are unemployed, half. now, just to show a little bit of a comparison. since president obama has taken office, the unemployment rate for 20-24 year olds has increased from 12.4% to 13.9%. median income for those under the age of 35 dropped by 10.5% from 2007 to 2010, more than any other age group. and more of today's 20 to 30-something are living with their parents than many of the generations that have gone before them. this president's failure to -- and this congress' failure to
get out of the way of job creation. in 1980, 17% of adults, 20 to 34 -year-olds, had to live with their parents and that number today is 24%. at a time when these young people coming out of college face mountains of student loan debt, they can't find jobs. and, instead of looking and working to find ways to provide opportunities for these young people, president obama, and his policies are making -- setting the stakes for these people to be more dependent on the government. any way, that is just to highlight your point exactly, that is the sector of our population that is the product of tomorrow and they are unemployed. mr. gardner: add the fact that this generation graduating from college is going to be left with a $16 trillion debt.
that's what it is today. and it is growing each and every second. and in a few years, that number goes up dramatically to over $20 trillion if nothing is done to stop the runaway debt crisis we have right now. and you mentioned the associated press article, one out of two graduates being unemployed or underemployed and the same report talks about this, taking underemployment into consideration, the job prospects for bachelor degree holders fell last year to the lowest level in more than a decade. and so, we have seen this conversation take place about, you know, are we better off today than we were four years ago, but here's a statement from the associated press when it comes to people who are graduating from college who says taking underemployment into consideration, the job prospects fell last year to the lowest level in more than a decade.
how are these families going to make ends meet, college graduates who come out with a family going to pay back their student loans. we have seen it sore over the past decade. they have increased over 275%, yet job prospects as bleak as they have been, for 10 years or more. and i've got some great universities in my district. university of northern colorado, cole state university. we have visited northeastern colorado university. talking about the challenges they face and trying to make sure the students have the jobs they need when they come out of school, because what is happening, you see the higher debt load and because the economy is so tough, people are taking jobs that are lower paying just to make ends meet. this country has prided itself in making sure we have greater
opportunities and we open more doors for our children. and that's the same thing -- the same kind of idea that ought to be facing the recent graduates of today, this upcoming december, next may. they ought to be looking at job prospects that are even greater than their older brothers and sisters and greater than their parents' generation. but the fact is, those jobs don't exist because the policies of the last four years have made it moran more difficult for this country's business to grow and expand. >> you mentioned your colleges in your district. i have some great colleges that are right nearby. alabama state university, troy university and huntington college, but let me highlight quickly, alabama's two-year
college system, where we have incredible work force development programs, honing skills in young people that can immediately go out into the work force and they deserve better than these false promises. did you know that president obama was inaugurated in 2009, the manufacturing sector has shed 990 -- 590,000 jobs. 5,000 90 jobs. since president obama was inaugurated in january of 2009. the number of americans receiving food stamps as of april, 2012, was 46.1 million. i heard today, one of our colleagues say one in seven -- one out of every seven americans is receiving some sort of
nutritional assistance. that is astounding. that is astounding. so we've maintained a picture here that is weak and we are telling the american people what they already know, because so many of them are too aware of this because they are the ones that are suffering from thr administration. but i just want to say we have solutions. we have solutions where we can change things and the private sector can thrive and that means getting the government out of the way. we need leadership in the senate to have the political courage to stand up and take up our jobs bills, our energy bills that reduce regulation and does just that, get the government out of the way. . . mr. gardner: i talked to a multigeneral separation --
multigenerational family business that was started by this man's dad 50 years ago. his son is going to take over the business, third generation manufacturing business in denver. they've got around 300 employees. spread out in the western united states region. and i asked him, i said, you know, the past couple of years, are you doing better now than you were then? his answer was, no, on any level. if you ask him about what his bottom line is, the company's profits, no they're not better off than they were. if you ask them about the number of employees he has, no, they're not better off. in fact, they've struggled to try to make sure that they're able to keep the employees that they have been able to keep, by -- and this is something else that's thank goes unreported -- something else that goes unreported. that employee who is usually working a 40-hour workweek or maybe a little bit more is now working a 30-hour workweek or a 32-hour workweek. because as an employer he feels a responsibility to try to do everything he can to keep these employees working. to keep their families with a job in the household.
but in order to do that, because their business is down, because their sales are down, they've actually now found themselves in situations where they're reducing hours. which means less take-home pay. in fact, if you look at the past four years, we've seen middle class pay, take-home pay go down by about $4,000. so, if employment is decreasing and again you look at those employment numbers that just came out this past week, for every one person who found a job, four people quit looking. and so you can see that this business isn't alone in trying to make ends meet to. try to build a better tomorrow. and we talked about the regulations that they face and i talked about some of the recent changes that have been made, whether it's financial services legislation. in fact, one of the of the interesting points we were talking about regulations, as i'm sure you've heard a great deal about businesses in your district that are facing challenges with regulations and the ever-increasing cost of
regulation. but this particular business, they were talking about how because the tough times that have hit their contracts, the people they contract with, the people who buy the goods from them, they're now actually having to float the cost of that business on their own books a lot longer. and because of the difficulties with some of the financial legislation that we've seen, they're finding it even more difficult to do that. so here you have a company that's trying to make it work with their customers so that they can buy their goods by holding their receivables a little bit longer. but they're finding pressure now from financial legislation that makes it more difficult to do that. so the government's getting them both ways. the government has failed to come up with policies to get government out of the way so that our businesses can grow and yet when you have somebody coming up with a solution to try to grow their business, government policies, they're affecting that and impeding their ability to do that. mrs. roby: absolutely. when you talk to business owners or at least when i have, you'll
hear them say that there was a time when regulators came into your business to try to make it more effective or a safer environment in which to work. but that time is long gone. now the regulators are there to find problems and fine you. i want to give you anunexample that was astounding to me -- one example that was astounding to me. a fellow that's in the construction business was explaining to me that he had a friend that's a roofer that had a $700 job to make a $700 profit on a roofing job. and his crew was over there at this howe home all day long, had the larder they were going up and down and after 5:00 a regulator was driving down the road, pulled over and noticed that he was afraid the ladder didn't come over the eve of the roof just far enough to fit within the regulatory requirement. he stops and wrote that up to
the tune of $8,000. ads 700 job, an $800,000 fine. these guys have been going up and down that ladder every day. we agree that not every regulation is bad but this is an environment that has gotten out of hand. people with too much time on their hands and not coming into businesses in the spirit of helping businesses thrive. mr. gardner: and i think that's why we have to start talking about solutions for this country. and we can -- we all have examples of regulations that have gone amok. i was dealing with a business in the district just the other day that talked about a product that they were trying to handle, it was a very environmentally sensitive product that they were trying to remove and actually do some environmental mitigation from a cleanup site they were working on. and this particular company was required to keep this product
both wet and dry at the same time. a regulation that said you had to keep it wet until you moved it or stored it and then you had to keep it dry. well, you got to dry it down in order to move it but yet they face the possibility of being fined because of this particular action. again, the solutions that we need this congress has passed solutions and i'll mention the reans act. the reans -- reins act was a bill we passed several months ago with strong support from both sides of the aisle. this is one of the bills that has passed the how it's and moved over to the senate that sits stacking up like cord wood. here we have an opportunity to doing something. the reins act says we're going to take the look at a cost of a regulation, we're going to get the idea of how much some regulation costs and if it exceed as certain threshold, then we're going to let that come back to congress for a review before it can go into effect. it's saying, let's take a look
at this, let's create some kind of an opportunity for congss to review a regulation that has a tremendous impact on the economy, taking hundreds of millions -- over $100 million out of our economy to comply with the regulation. let's take a look at it and make sure that the cost and benefits are in line to. make sure that the benefits outweigh the cost. to make sure that doing it is actually worth it and it doesn't cost jobs that we so desperately need. so the reins act passed and it's waiting over in the senate. now, some people may say, well, that's just a partisan idea. that's just a republican idea. let's take a look at what some of the states do. in my home state of colorado there's a process called the rule review act. the rule review bill. this bill comes up every single year in the state legislature and it's a chance for the state legislature to do exactly that. to review the rules that pass out of the executive branch agencies. every year the state legislature gives a thumbs up or a thumbs
down to those regulations. because in colorado we understand how important it is to make sure that government's not getting in the way. how important it is to make sure that we actually have responsible rules that move the ball down the field instead of creating penalties. every time you turn around. and so the rules review bill taken to the united states congress, becomes the reins act. and the reins act is a good way for us to check and provide that balance with the executive branches to. make sure that we're not putting too much of a burden on our businesses. mrs. roby: right. and, you know, let's just go back in time for a minute and talk about some of these other repeals. we have the boiler mact provisions, the cement market, net neutrality, the regulating farm dust. i mean, we go down the list one by one by one and talk about the efforts that we have taken here
in the house, all under the -- with the strength of the numbers here, some of these are -- have been with bipartisan support that we pass these measures and yet again and again and again, time after time after time it's sitting in the senate without any action and, look, all you have to do is go look at the budget that the house has passed the past two years, that chairman ryan put forth out of committee and came to the full floor. you mentioned the president's budget where there were zero votes, zero votes, and we talk about offering solutions to the american people, to look that small business owner in the eye and say, yes, i am working for you, yes i have a solution for you, yes, i have a way to get out of your way which is what we've done and our budget
outlines very, very specifically what these solutions are. the spending, our spending is out of control which in turn, like you already mentioned, just goes -- takes it to a whole other step that this congress is not doing their job and therefore the jobs are not being created by the private sector. period. it all comes down to that. mr. gardner: and i know you serve on the ag committee, the agriculture committee here in the house of representatives and i'm sure that you're hearing from some of your interests in agriculture. about uncertainty. mrs. roby: absolutely. mr. gardner: one of the things i've heard over the past several months, in fact i heard a series of round tables where one of the things we heard about so much, and this is part of the fiscal cliff we're facing, is the death tax. the death tax that this nation faces going back into the lower exclusion rates as of january 1. let me give you an example of,
and i'm sure you've heard this time and again from the people you represent, one of the farm round tables that we held, a young man from eaton, colorado, stood up and said, with the estate tax come back in at the end of this year, beginning of next year, we'll be forced to pay for our farm for a third time. and we simply can't afford it. this is a young man who wants to go on into the life of agriculture. this is somebody who wants to be the next generation standing up to grow our food and fiber that this nation depends on. but yet you've got a government policy that's going to say, you know what? we know you've invested, we know you've grown your business, you've made investments into the land that you need to make your operation successful, but because somebody died we're going to tax them. and that's part of the fiscal cliff that this country faces at the end of this year. there are farmers, ranchers around the state of colorado, around this country who are not trying to figure out how they're going to pass on their operation
to the next generation, pass on their operation to the next generation because of a government policy that says, you know what? you've been too successful. and we're artificially going to place this barrier so that it's going to hurt you. and that's not just farmers and ramplingers. it's all businesses. mrs. roby: the problem with our farming communities is that they are in a lot of instances, they own a lot of land so they have wealth when it comes to land ownership but they may not have the cash. and so when the government comes along to tax the farm upon the death of a parent that wants to pass it down, they got to sell the farm to pay the tax. and that's where our farmers lose out every time and there are numerous other businesses throughout this country where they may be cash moorks they may have some assets but they may be cash poor so they end up having to sell it off in order to pay
the government for that company's success. mr. gardner: you mentioned it too, it's not just about cash in the bank. it's not just about how much money you have. it's about the assets that you have. so your example where you may be cash poor, but still hit this line i think is compeling to not only the farmers and ranchers but to small businesses around the country who may own a restaurant, who may be trying to expand the sand and gravel operation. but they're going to be hit by this estate tax which means they've got to sell, break it up and not be able to pass it on. mrs. roby: and you just add our lack of tax reform which we so desperately need and i know that we are committed to that here in the house majority, we do have a plan that we set out as it relates to those reforms. we know that american businesses are faced with an unbelievably complicated and commerce and tax code, combined over 30% on
businesses. not to mention the problems with the estate taxes. it makes the u.s. as the second highest corporate tax rate among developed nations in the world. and so the u.s. federal rate is 35%. it's nearly 10 percentage points higher than other -- our other competitors. so that on top of all of the other issues that we've highlighted, where in order to create -- know, i mentioned the manufacturing jobs. i don't know about you but i get this question all the time, where have all the manufacturing jobs gone. and people always highlight that we've just chased these jobs offshore and it's because we have created this environment in which business owners don't have a choice. if they're going to turn a profit they have to do what is the benefit for their families and to make that hard-earned llar. i remember hearing a colleague give an example, he was sitting on an airplane next to a guy that made things.
he made things, he produced a product and he wanted to make them in the united states of america. but when it came down to it, the bottom line, he thought he was going to open his plant right here but when it came down to it, they hadn't taken into account the corporate tax rate. and the difference between that and the next country where they could manufacture his product. and that sealed the deal. that sealed the deal. they are not manufacturing in the united states because of the environment in which we have. mr. gardner: you've got a government policy that actually is an impediment to job creation here. a company trying to bring jobs back in but because of the cost of doing business here, so much higher than elsewhere, they had that unfair choice of, how are they going to make things work? lou they going to be successful? . mrs. roby: small businesses fighting taxes above poor sales
as the financing will most important problem that we are facing today. mr. gardner: talking about solutions when it comes to the reins act. the state tax, death tax, doesn't come in. we have made sure that we avoid the massive tax increases that loom again on middle-class families. thousands of dollars for middle-class families. and that's why the house of representatives has passed a measure to make sure that those taxes don't increase, make sure we are making it easier for people to keep their own dollars and invest it in their businesses. if this congress adopts the president's plan, if this congress does nothing, hundreds of thousands of small businesses
around this country are going to see tax increases like we have nevada seen before. tax increases will make it difficult for them to make ends meet. the house has act todd make sure we are dealing with the fiscal cliff and not making it more difficult to succeed. mrs. roby: again, as to the comparison, with the president's proposed tax hike, deficits would still total $6.6 trillion over the next 10 years, according to his own budget. by comparison, our budget, the house republican budget would reduce deficits compared to his, by 3 -- $3.3 trillion by lowering taxes on small businesses and spurring economic growth. that's the difference. mr. gardner: the key is you mentioned spurring economic growth and you can talk about what happens to this legislation, but the bottom line
is, we have to address that debt and deficit and only long-term economic growth is going to help us address our debt and deficit situation, but it makes it impossible for long-term economic growth. you have a circular problem here that for whatever reason, the united states senate, the president hasn't taken seriously. and just talk a little bit about the summer of recovery. that was supposedly going to occur a couple of years ago after a trillion dollars was spent on the stimulus. and united states taxpayers are going to be out half a billion dollars and never get repaid. the stimulus bill was going to lead to summer of recovery, but 43 straight months of unemployment at or above 8.3%. now the american people know
that even that number is not right because they know that maybe they have a job is only part-time or maybe they are working full-time, but it's not at the level that they know is their full passengers. certainly makes it more difficult to meet the needs of their families. that 8.3% number doesn't count the people who are giving up looking for work or underemployed. so the fiscal cliff, you have millions and millions of americans out there knowing what this congress refuses to do, and that is if congress would adopt these jobs bills that we have passed over to the senate, if congress will adopt the house budget that puts this country on a road and path to growing the economy, to preserving and protecting the promises we have made to future generations, that number's going to come back down. not going to be 8.3%, but going
to be lower. millions of people will be back at work because of the bills and legislation that this body has passed, most with bipartisan support. mrs. roby: to use the president's words again and these are direct quotes. last april, president obama said, quote, we have to live within our means. we have to reduce our deficit and get back on a path that will allow us to pay down our debt. that is the president just last april. but also, i want to make sure that there is no misunderstanding, this is the president's own words, in february of 2009, i'm pledging to cut the deficit by half, by the end of my first term in office. and we are circling back as to how we began our hour tonight, our national debt has increased by $5.3 trillion.
mr. gardner: $5.3 trillion and there is a statistic out there that shows that's more money than the amounts of money spent by the deficits between george washington and bill clinton combined. the fact is, we have never seen a period in our nation's history where unemployment has been matched by a failure to recognize the needs of the american people, where debts are allowed to skyrocket, where you can say on tv one thing, pledge to the american people you will cut the deficit in half and then the next thing you know it's up by $5 trillion and maybe the question isn't, are you better off than you were four years ago, but the question ought to be are you better than than you were $5.3 trillion.
mrs. roby: your son can answer that. we both have young children and this is why we're here. we're here for them, because we want this country to be as great for your children and mine and all of americans children and grandchildren and generations to come and quite frankly it is who are endouse that we would leave -- horrendous that they would leave this situation. how about spending massive amounts of taxpayer dollars on the backs of my children and my children's children. this is where the future of this country is dependent. and if we don't get serious about this now ysh why are we waiting until november?
why is the leadership in the senate waiting until after the election to take on problems that are serious now? as you said before, the clock keeps ticking up and the debt keeps accumulating. not that the $16 trillion is an arbitrary number. it doesn't stand still but will continue to increase and when i'm in town halls. the debt ceiling is like calling your credit card company and saying, i need you to increase my credit limit because i don't have any cash to pay you the interest on what i already owe on the debt i already owe. that's where we are, and that's on the backs of margaret and george and your children and all of those other children and grandchildren of americans and it's just -- i can tell as a mom, it makes me upset and that's why we're here.
republicans in the house majority, we have taken action. we have taken action on a number of things that have been mentioned tonight. that we have repealed the government takeover of health-care. right down the road of any district in this country and talk to any small business owner about that and you will find out that they will be close to being out of business or go out of business completely if this is enacted. we have stopped massive tax increases in this house that one independent analysis said could destroy more than 700,000 jobs. you highlighted that earlier. we have replaced these indiscriminate cuts with commonsense solutions by calling on our friends in the senate. but the budget reconciliation through commonsense cuts instead of just across the board and wasteful government spending and with the 30-plus bills that you and i have highlighted.
there are discussions tont that are sitting, collecting dust. all 30 of these jobs are jobs creating energy-producing bills that are sitting in the senate collecting dust. mr. gardner: you talk about the bills and regulations we have passed. talk about the things we have done to avoid the fiscal cliff and avoid sequestration and there is a word that has been missing that we haven't used tonight. it is leadership. it takes leadership to address these issues and we have provided that through so many of our bills. to make sure hundreds of small businesses don't have their taxes increased, leadership to make sure that farmers and ranchers can continue their ranchers that will prevent them from passing on their land to the next generation and make sure that the sequestration is carried forward. we reduce spending but do so in
a more responsible fashion and we don't jeopardize the ability of our men and women in uniform to protect our country and themselves. and i want to talk about sequestration because that's something we haven't met. and the issue of leadership crops up. it just keeps coming forward where the house has led and we hear crickets from the other side of town. and the american people -- i don't know if they were following what happened to the white house just this past friday. last week, the white house announced that it will miss the legal deadline for delivering a report to congress on the spending cuts that will take effect in january. we hear a lot of complaints that the congress hasn't done this or that. but here's a law that says you've got a deadline to present your ideas for leadership to the
american people. and i guess it must have been too tough, because they aren't going to comply with it. mrs. roby: you'll see again further action from leadership here in the house on that are calling on the president to outline exactly what it's going to look like. and he hasn't and just one more on the list of uncertainties for job creators. our see our colleague and friend, the gentleman from kansas has joined us. and feel free to jump in. >> i appreciate the opportunity -- i appreciate the opportunity and just like my colleagues, spent a little time in the real world, some call it a recess. it's the opportunity to go back home and i would much rather not be here and be at home, but what i heard at home is many of the
same things that my colleagues are saying tonight. washington, can you get your act together. this chamber, we passed many, many things that would improve the community. one of the things, times have changed. some of my colleagues think it's the same old, same old. but when we hit the $16 trillion for debt, $16 trillion, that raises another red flag about what's going on in washington. and i'm a republican. my colleagues tonight are republicans as well and it's not a democrat or republican problem. at the end of the day, it is a washington problem. it's the fact we can't get our act together in washington. mr. huelskamp: we can free up job creators and roll back regulations, but at the end of the day, $16 trillion in debt.
and like my colleagues, i have four young kids and each one of them, they have done nothing wrong yet. i catch them every day at that, but through no fault of their own, they have $50,000 they are going to owe and owe on spending that has already happened before the freshmen colleagues and i arrived at this place, and it's growing every day. the trillion-dollar deficits have become the new norm. the previous year, the administration, deficits in one year, you could have -- actually, i think the president, then senator, was bemoaning the fact that what an insewer mountable amount that was, but we have doubled and tripled that amount. that adds up. my constituents always say, i can't quite understand what is a
million, billion and trillion and it's hard to explain. but for the last 3 1/2 years, this president, this town, washington has added $3.5 billion of borrowing every single day. and that is unsustainable and they want us to solve this problem. but again, when folks, like us gathered here, see and hear the concerns of americans that we have a spending problem, it's not a revenue problem. if it was a revenue problem, we would let off the gas pedal on regulations and take care of that. everybody knows that. every job creator says, tim, i would like to invest more. american pack acknowledging in hutchison, kansas, he did build it. he says i import 34 folks and my father-in-law built this
business. and here's what i would like to do, i would like to higher two more people. and here in washington, two more people don't add up to anything. but for two families in kansas, it would mean the difference between paying for college television for their kids and whether or not they can update their used car and even actually go on a vacation. that's the difference here. and we have 23 million americans that don't have a job. or are looking for more work. and tony atlanta american packaging says this, just give me some certainty, tell me what the rules are going to be, whether it's the tax uncertainty. if nothing changes, if washington doesn't get its act together and the president doesn't step up to the plate and help us, we will have the single largest tax increase in american history and i dare say in the world's history. what happens at the end of the
day if we don't get help from the administration and the senate democrats aren't willing to provide serpt and we have the regulatory uncertainty and the health-care uncertainty, the provisions of obamacare are rolling in. small businesses like tony do not know -- what do we have to cover? i don't want to higher two more people because i don't want to be fined. it is that type of uncertainty and the businesses are there, not just to create jobs, they are there to make profit for the owners and perform a service for the public. not here to work for washington and that is what will happen. . . a newspaper was fronting for this administration because tony talked about the fact that him and his father-in-law built this business and the newspaper said, no, you didn't build that business. the government played a key role in making that happen.
you know, the government wasn't there with his frble had -- father-in-law when he hired employee six, employee seven, employee eight. they weren't there. they didn't take the risk. now they have this whole town wants to take credit, including this president. every time someone hires a new person. but they don't take credit or don't take fault for the fact millions of americans have quit looking for work in the obama economy. and it won't be perfect under any president. it never is. washington can't dictate how an economy ebbs and flows. what i trust in those american people, in american business men like tony, that say, hey, i would like to invest, just give me the certainty to do so and i'll hire two more folks. doesn't mean anything again in washington but it means something in the real world. i appreciate my colleagues being here. one of the things the newspaper did mention, it was a taxpayer-funded college professor, did indicate as well, he said, you know, just want to let you know that the free
enterprise system is a charade. and of course i guess if you work for a public university, free enterprise might be a charade. but this is the type of thought that invades i think many in the white house and certainly invades where this gentleman teaches. the fact is free enterprise is not a charade. what it is about is individuals taking risk, making decisions, free from me, free from you, free from martha's demands. flee -- free to make and take those risks. that's how the economy will continue to grow. that's how we built the best economy in the world. and that's the economy that's being threatened with the $16 trillion of debt and again this is not our problem, it's not their problem, it's america's problem to solve it. i think we're making progress in the house and we're going to continue to move forward. that's what i've heard in my district about their concerns about where we're going to head and where we need to head. and i have had town hall after town hall, about 140 town halls, usually about every town hall
someone comes up to me and says, tim, i'm doing pretty well. and my district is doing fairly well, despite a massive drought in which impacts into colorado as well. we can talk about water all night but we probably better not. we're friends right now. just kidding. but they come to me and said, i think i'm going to do fine, i'm ready for retirement. the guy's 62, he told me in the last time, he said, but i'm worried about what kind of america i hand on to my children. and grandchildren. and this current state of affairs is $16 trillion. he said, i'm ready to do what it takes. i'm ready to keep working a little bit longer, do a little more, make a little more sacrifices, a little more investments because i want a better country than i was given, my parents gave me a better country than they had and my grandparent zts same. that's the type of proprofments that's why i get optimistic. that's why i like to go home. that's what you guys hear at home as well as i do. they're optimistic. they're hopeful about the future despite what's going on here in washington, d.c. mr. gardner: the gentleman from kansas and i share a common --
we share the border. eastern colorado, western kansas. and some of the challenges that my farmers are facing, your farmers are facing. and you're right. we won't get into water tonight. we'll save that for another day, another time. but the fact is we can both use more of it. mr. huelskamp: absolutely. mr. gardner: we store more water. and yet we have policies that are keeping from us storing more water, adding yet to the uncertainty of our farms and ranchers who desperately need it. and so whether it's the tax increases that we see at the end of this year, if nothing is done, the estate tax, income tax rates, capital gains rates, and you mentioned that this isn't just a big tax increase, this isn't just a large one for the united states, this is the largest we've ever seen, not just in the united states but around the globe. mr. huelskamp: 55% death tax. that's the one that hits the heart of my small business men and women. they're trying to hand on their business to their children or grandchildren or someone else they choose and government's
going to come in and grab up the 55% of that estate and that impacts farmers and ranchers in particular, and many other small businesses. the very heart of economic recoveries in this country have always been driven by small business. it isn't the folks that hire 1,000 people at a time. it's the ones that take -- add one person or take a part-time person to full-time and that's what i'm hearing at home. they're frustrated but they're ready to go to work and they expect congress in washington to do the same. mr. gardner: you mentioned optimism for the country. i carry the same optimism, too, because the people that we work for believe that this is -- continues to be the greatest nation on facial of this earth. that if we have congress, if we have washington that's actually getting its job done, that will pass the regulations to make it easier to do business, excuse me, to repeal the regular lyings -- regulations in this country to make it easier to do business, to make sure that we don't increase taxes to hurt their small businesses, better days are still ahead of us. mr. huelskamp: tremendous days are ahead of us. just stop doing what you're
doing. heck, i'll even admit it, some of them say, what's there right now, as much as i don't like it, if you'd just keep it that same. two years, give us a breather. give us a moratorium. we'd like to roll them back, but give us some certainty on taxes, on regulations, on health care. and, tim, we'll take care of your revenue problems. we'll do it for you. mrs. roby: the only thing that we all can agree on is that the only thing that is certain is that uncertainty. and to hear the consistency and -- in all of our experiences back home, it's astoundsing to me why we cannot -- why the president and the leadership in the senate cannot see this. because if they're really listening to the same americans that you and i are listening to, they would hear the same message that we brought to the floor tonight. mr. speaker, the choice for the president and the senate is very, very clear. it's rather political paralysis that leads to certain economic
catastrophe or bipartisan leadership that puts us on a path towards prosperity. and i would just ask that they keep in mind a few people. remember who this economy has hit the hardest. you've heard stories tonight in this hour of those business owners that have said just that. remember the mom at the grocery store that are trying to put food on the table for their family or gas in the car to get to their one or maybe two jobs. remember the young people, the recent graduates that we've talked about that can't find a job and half of them in the class of 2012 run employed and they're drowning in debt. all of these groups, all of these groups, they deserve leadership out of washington not lip service. and with that, mr. speaker, thank you and i yield back. the speaker pro tempore: does the gentlelady also have a motion? mrs. roby: i move to adjourn.
the speaker pro tempore: the question is on the motion to adjourn. those in favor say aye. those opposed, no. the ayes have it. the motion is adopted. accordingly the house stands adjourned until 10:00 a.m. tomorrow morning for hour debate. live coverage, on c-span. the presidential debates, live on c-span, c-span radio, in c- span.org. coming up tonight, an economist
discusses the tax increases and budget cuts scheduled to be in effect at the first of the year, the so-called "fiscal cliff." and then, looking at the congressional legislative agenda going into the election, and later, health and human services secretary sebelius talks about suicide prevention. we will be live from the conventional remembrances ceremony, where members of congress will honor the victims of the september 11 attack at the u.s. capitol. our live coverage starts at 11:00 a.m. eastern, and on our facebook page, how you think the u.s. has changed since the attacks. visit facebook/cp,cs [am -- facebook.com/cspan. the bush-era tax cuts that
expire. the national press foundation event is 2.5 hours. >> thanks very much. so, did morning, everyone. i am the director of program for the national press foundation, and we are very glad you are here this morning. we want to welcome paul, and how many of you are here? let's see a show of hands. this is a fabulous grid. this is the first official meeting of the year, and we are getting off to a good start. i want to thank the center on congress at the university, which is one of our co-sponsors for this event ray lahood also, are closed here at the wilson center, our partners -- are co- sponsors for this event. also, the wilson center, our
partners. programs on financial literacy for journalists. today, we are here to talk about the fiscal cliff, which is a phrase that none of us had even heard of a year ago, and now it seems like it is practically all all we hear. i know this has engendered a lot of confusion among a lot of people, and we are very fortunate to have with us today people who will help us understand exactly what it is. the fiscal cliff. this is the senior fellow on budget and policy priorities, an expert on these things, especially federal and state fiscal policy. he is also the author of a number of books, why do i feel so squeezed, and in this recession, what is the fiscal
cliff? after that, we will talk about the implications of the fiscal cliff, what happens when we go over it, how we might avoid that, and in the final session, aimed directly at journalists, how do you look at this issue and what are some places you can go? thank you very much. yes, sir? >> if you found yourself up to this room, then you are probably smart enough to figure out the fiscal cliff. it is kind of tricky getting in here. i have been here for decades. let me start by saying i am sorry that i have to run out like cinderella at about 9:55 to get to another heated discussion, so i apologize. the facts of the case, and this
can get confusing, and it is a small enough group. where is linda? she slipped out. why do we not just make this more of a conversation, so if i say something that is not clear, i will try to clarify. it is more of a philosophical question, and there are deep philosophical questions in here, we will put that off for a few moments. when i think about the fiscal cliff, i like to think about its origins well before i think a lot of people who dwell on this. most people i think think of this as coming out of the budget control act of 2011, but the origins were planted in the
initial tax cuts pursued by the george w. bush administration. and if you listen to practically a paragraph about fiscal policy in the campaign, somebody is going to say "bush tax-cut." that is what they're talking about, the 2001 and 2003 tax cuts. those cuts were passed with a bit of a time bomb implanted in them, whereas -- they were legislated not to be permanent but to be in seven years with the 2003 version, so they were going to expire at the end of 2010. part of this was to squeeze the tax cuts, and, of course, when you cut taxes, you lose revenue as far as cbo is concerned. they are the scorekeeper of such things, and in order to make the budget window look better after
a first tenures of these being in place, the tax cuts were scored two and after one decade. we can get into more details about that. and there is no reason for them to say that these were 20 year or forever tax cuts, but they made an 10-year tax cut, so then you might say, ok, why did you not hit the fiscal cliff? we did. i was working for the white house then. there was the december deal between the president and the democrat and republican leadership to expand these tax cuts for another couple of years. guess what? another couple of years is almost over.
fiscal archaeology there it, the origin, but more pointedly, getting to the origins of the fiscal cliff as we know and do not love it today, you have to go back to 2011 and talked about the debt ceiling debacle, whatever you want to call it. in 2011, the u.s. treasury was about to bomb, against something called the debt ceiling. there is an amount above which, some number of trillions, in the teens, the government may not borrow to finance its debt and to make its interest payments. there is some debt we owe to the public and others that we go to ourselves, but that is not relevant. there is dead that we have to
pay interest on, if we do not pay our interest on our debt, we would've fought just as you would do if we did not pay our mortgage. historically, -- this is nominal dollars. it was re something like one dozen times during the reagan years, and it was never a big deal. the debt ceiling became a huge, contentious debate, and it was a very contentious, and you may remember that there were members of congress who were saying, "i just do not care if we default, "-- "i just do not care if we default." we can talk about whether that is or is not a responsible position, but it certainly was the position of members of
congress refused to rubber- stamp. that led to the squabble, and the next thing you know, you have this agreement in the summer of 2011, which extended the debt ceiling. that was a key part of this budget control act. lots of really bad things happening. they were downright terrible. we have no reason to default, so that really was a debacle. that really was a major self- inflicted wound that i believe hurt the economy and continues to reverberate. as part of the budget control act, a couple of things happen. the president was allowed to raise the debt limit about $2 trillion. , sufficient to get the debt ceiling up to where it needs to be to be sufficient through
early 2013. and how about talking about something different, like rg iii yesterday. and there is something else that we will bump up against again probably in 2013, said that was one thing that happened, and the budget control act established limits or caps on appropriations or spending. this is patently wrong, and, in fact, there was $1 trillion of spending cuts in the budget control act, which has been implemented. that was by luring the caps on allocations. -- lowering the caps.
there were spending cuts, and, ok, now we are heading to the cliff. we want another $1.20 trillion in spending cuts, and the house and senate have to produce legislation -- if they fail to do that, they will have to form a committee with both members of congress, and i think it was called the super committee. do you remember the super committee approved the super committee was to come up with had to save another $1.20 trillion 32021, beyond the savings in those lower caps a that i mentioned. and if the super committee fails, ok, here we are.
we are at the cliff. if the super committee fails, there is a fallback mechanism, as it were, called a budget sequestration, which is cuts to a tune of $1.20 trillion in debt as a reduction that has to be implemented automatically. automatic, across-the-board budget cuts, almost exclusively on the discretionary side of the budget. the budget has two sides, and it is mandatory, mostly the entitlements. this is only for the most part. these are the two sides of the discretionary part of the budget. you have to account about $110
you know about the relatively weak jobs report from august. there was the 2010 deal that i mention where the bush taxes were expended. there was also a payroll tax holiday, or payroll tax cut that was implemented. there was employment insurance that was implemented. at the end of 2012. you have something at the tune of, according to the cbo, about $6 billion in basic deficit- reduction in 2013. there are safety measures that are expiring. the bush tax cuts, and then another chunk comes from the
automatic spending cuts. basically, this is a nightmare. and i am not talking to you as an economist. i am talking to you in a sense as a keynesian economists, because another way of looking at this as an economist is to say, boy, that is really big deficit reduction. going from this year's deficit down to something like $600 billion is a huge accomplishment in terms of deficit reduction, and you might say, "jered, what is that?" and the problem is is sort of like taking a dose of medicine that you really need, but you take so much of it that it kills you.
this is not physical science. i do not know that the congressional budget office has ever done what adam dunn, regarding their deliberations. their analysis, i should say, around the fiscal cliff. they are saying this would go back into the recession. they predict that the economy will go back into recession, that gdp will contract something, i think, about 3% in the first half of next year, 2.9%. unemployment, does anyone know what the unemployment was?
it went down to 8.1% in august. it will go up to 9.1%, and it has been coming down. it will reverse course, according to the cbo, if we go over this fiscal cliff. and there is one that i impartial towards. i am partial towards a number of them, but there are those that say it is more of a fiscal slow. i am getting a bit of myself. that is the lay of the land. that is what i am looking at here. linda, it is ok with you, i thought would see if there are any questions.
>> they did not -- congress passed the budget control transparency? >> right. union, is there any consequence in terms of some kind of legal aspect? >> yes. what is the result of that, what is coming? >> that is a bigger question, and it has to do with the impact of the fiscal cliff, in he is talking about the sequestration, the automatic cuts. there are two sides of the budget, mandatory and discretionary, and i am sorry about the opposite of talking
past year. i am sorry for not pitching this thing high enough. i have found it very useful to break this down to the building blocks. i can probably go deep in the weeds if you would like, but this is a level that is useful to people -- ok, good. the question, let me answer that one first. and these are supposed to be made across the board on the defense side, this is how crazy this is. the center for american progress, and if you are a
whether agencies can plan for this, in my view, i guess it is not hard for the agency to plan this. ultimately, these dollars go out. the s.a.a., -- f.a.a. gets funded annually, and it has a bonds -- a bunch of projects in play. scott was looking at particular airports. this airport is probably going to have to close because they will not have to fund their air- traffic control center, which is paid for by these budget appropriations and there is some that say you have to have 10 people doing this.
they would have to close. they cannot reduce their services. they would actually have to close, and that is actually quite disruptive. and there has been a lot of hand-wringing about contract, government contractors. we do about $500 million of government contracts each year. watching these members of congress, saying keynesian economics does not work, and with the automatic spending cuts, this is a job killer, so, clearly, they both cannot be right, and, in fact, government spending creates many millions of jobs, obviously. i am not saying they are good jobs. i am not saying i am all for it.
we can argue about whether or not we overdo it. there is 20 million government jobs. that belies that claim anyway. -- >> do we have one more question before we bring some more voices into the conversation? anybody? >> this would be a catastrophe? >> yes. i am just curious. >> nobody would lend us more money. we have loaned a lot of money to
a lot of countries. china is a big lender to us. about 10% of our debt is to china. in order to continue to provide the goods and services, the public goods and services that make this country run, we would have to try to borrow money because we could not do it without that, and the interest rates would be prohibitive. who would lend money to a country that just defaulted? in fact, if you look around europe, that is a good example. italy and spain has not defaulted yet. actually, many of us view in greece as on the verge of that. right now, are 10-year bonds, we have to pay an interest rate, the government has to pay an interest rate, really low. in spain and italy, it has been up to 6%, 7%. in greece, it has been up to
20's%. it is pretty simple. our creditors would not deal with us. >> i think we are ready to start our next panel, right? >> i am the congressional editor at politico, and i have been doing these panels are almost 1.5 years, and this is such a great panel. we have brought in a couple more experts. starting on the and is my friend and old c.q. colleagues. what is your title now, frank?
>> i am defense report. >> you have been doing this for years. you are going to be our expert on all things defense, a sequester, helping to understand how this works. and to the right of frank is a staff reporter for "the wall street journal. you cover international economics, and you are one of our other experts. do you want me to speak on this? and i would like to start with frank, and a sequester is something that people are starting to talk about in a serious way. when we were doing things at politico.com i started editing
the word "sequester to speak out of things because people do not know what that means. and they are doing a tour where there are a lot of military jobs, florida and north carolina. there is a process that is already on, including its defense contractors. there is going to be a cut in the first year. >> that's drop -- that set a
baseline. so this basically draws the base line down. the fear that a lot of people have about this is that defense has already come up with a plan to find savings over the next 10 years of about $480 billion. now, it is important to know, i am a little less into the fear mongering that seems to go on concerning defense cuts in general, and with a projected growth in defense.
and projecting budgets out for five years is kind of like dark magic at the defense department. it rarely ever turns out that way. it is kind of like finding out what dark matter is. you see shadows, but you do not actually see anything. a lot of this is tied up in a horse race, which i think his paper does a good job of. there is a horse race that gets into the politics. it really comes down to a fight -- nobody is coming up with a plan to avert sequester. you are hearing the aerospace industry association talking about 1 million or so jobs leaving the defense industry.
you have a federal department coming out to save and it is not known whether or not there will be a sequester. you know the congress does not do anything until absolutely must, and one of the things we are learning about sequester is we do not know really when it will fall. we know on january 2, it is supposed to happen, but the office of management is supposed to manage what happens, and there is a thing called apportionment, and there was a fine story written, talking about omb can talk about when they start to apply a sequester. it could be in the last quarter of the upcoming fiscal year before they actually do. now, the cuts as a percentage of
all will also be more severe, but they give congress time to figure out what to do. both sides are demagoguing the issue. right now, the republicans are saying that the sequester was really the president's idea. it is kind of laughable that either side tries to blame the other. they supported be a part of the budget control act. i did a cover story for "cq," because we wanted to do this story, and everything stops here. whether you're talking about medicare, social security, or talking about sequester, everything assumes you will do nothing between now and when it happens, which never happens.
it has never happened that way. there is always a deal that is meant to push things off. the president proposed a deal that i think will push up the medicare insolvency eight years. now, the democrats say the republican plan would roll it back eight years. it is an incredibly costly business. and you have congress and its pro-israel interests. and then you have the industry, which makes beaucoup bucks out of this. a lot of times, the other sort of the dark magic is -- magic is
they cannot do this. they really cannot tell you how much they spend. they try to cut command a couple of years ago and projected out what they were trying to say. it was in virginia, the joint forces command, and when they finally shut it down, they actually found that they saved twice as much as what they said they would save, which tells you they do not know what they are spending. and the defense department represents a huge amount of the budget with the war and the defense base spending. you're talking well over $600 billion in discretionary funding each year, so as you can see, this is a very complicated thing, and we do not get answers because it is caught up in the horse race. everything is caught up in the course race. they are trying to figure it out, in these races will come down to, in a state like
virginia, it will come down to who can make the case that it fault.s party's some of the biggest haters of sequester, like one man who hates a sequester, but he actually voted for the budget control act. his counterpart, adam smith, who hates sequester, you find at this across the board. there are no clean answers here, and at the end of the day, everybody is responsible for it. >> cast to a question -- can i ask a question? i have been waiting to run into someone like you. as -- it is my understanding -- myrrh the things i am concerned about is this stuff about jobs. it is my understanding is that a lot of defense contracting in hiring as a multi-year lag, so
that employment that is currently in place and factories and producers along the supply chain making this stuff is funded by contracts that are year are too old. i am not advocating the go over the cliff, but if we did see these kind of automatic cuts, which would have less unemployment that is currently under discussion. >> we have seen a lot of questions about this. the defense department deals in two types of budget numbers. there is the budget authority, which is essentially what congress gives. it says you have budget authority to spend as much, and then there is such a thing as a budget outlays. this is the money actually spent by treasury on these various different items. in budget authority, we conveniently like to focus on budget authorities. the outlays still withheld money is spent. right now the defense department is spending money and defense
contractors are spending money that have been authorized a year ago or two years ago. operations and, which is a huge portion of the defense budget, spends pretty quickly. you have personnel type spending, and personnel is exempt. that is a very interesting point. the president and omb will set the standards for how sequestered is applied. currently they have decided to exempt personnel. that makes sense in one regard, because you don't want to lay off a whole bunch of very experienced war fighters. we have probably the most experienced military ever in the world. we have been at war for a number of years and that means we have a very experienced cabaret of military personnel. -- a very experienced cadre of
experienced military personnel. >> this gets into what i was talking about, adjustments in managing sequestered. under the budget control act, the overseas contingency operation fun, that is the war front, was exempted. the initial savings exempted, so people like daniel in l.a. from hawaii -- daniel inouye, says we will use the overseas contended the operation fund to grow so that we create flexibility. they love to use it to shift money back and forth. omb came out and set however, oco will be subject to the sequestered. that may sound like the guys on the front lines are going to
suffer heavily, but what he has done is add $5.9 billion to the fund. they blow it up and allows them to spread out the payment sequester a little bit more. to get back to your question -- >> my simple. with that, if the defense january 1, it does notfect on necessarily unch of defense workers get laid off right away. they may be working on projects that were funded well before that. >> can i jump in and ask about the war and act? -- about the warren act? can you talk about whether that is a political thing or real thing? >> it is both.
the labor department or somebody basically came out and said you don't have to send these letters out. >> you give 60 days, when you are doing a mass layoffs, you need to tell people. you need to send out a warning that this is coming. and defense, the defense industry has come out and said we are looking at pretty heavy layoffs here. what dr. bernstein is implying without laces that the defense votes would not necessarily have to make cuts immediately. publicly owned companies often use moments like these to find efficiencies to save money, so they do layoffs. if they are going to do mass ones, they do have to notify people. in the political context, the administration thinks it is not knowable yet, not definite that
there will be layoffs, therefore you should not because it will be disruptive to the economy. everyone knows it will be disruptive to the economy. where the differences in the lot like, who is going to prosecute these things? we will learn about sequestered, and what we learn may be of dubious content. we are at a place of not knowing. the administration may not want to share everything about it because they like the pressure created in congress to come up with some kind of deal. when we are about these things piecemeal, it starts to have an effect on the economy. they start sending out pink slips and say that in 60 days the job is gone, that is going to call some disruptions. it has gotten politicized because we are in the middle of an election. how it plays is unknowable at this time. >> let me turn away from defense.
>> if i slipped out, don't take it personally. i wanted to do this for a few minutes while the chairman gets here because he is an actual trained economist who we call on frequently. i wanted to run through the presentation, include some basic concepts. sometimes we are going to our room, maybe 80% have taken a basic economics course and understand a lot of these numbers and figures that we throw out. just kind of walk you through how we get to some of the big figures, like a 2.9% drop in gdp in the first half of 2013. a couple of things i wanted to talk through, when we get to
this point about the debt ceiling, why are we all arguing about the size of the debt, when every time you look at the news, u.s. government borrowing costs have dropped lower and lower? why is this even a debate right now? one of the big reasons is in part due to a study that i have referenced here. two very well respected economists wrote a recent book looking at 800 years of government borrowing. this particular study goes back more like half a century and looks at government borrowing. what they conclude in the abstract is that once you get to 9% debt to gdp ratio, you start facing risk to your economy. what they found is that growth
slows by about 1% annually, one should get to that point. this is a simplified version of their exhaustive study. one of the most maddening things about covering economics is that everyone tries to redefine what basic economic theory means. this is a particular point that will come up a lot. a lot of people think we have reached the breaking point when it comes to u.s. government debt. if you look at to figures i put up here, they are both figures of u.s. debt. one is 15 trillion dollars, and that would be 100% of gdp. it should mean that over time, the u.s. economy will be slower because of higher debt. we obviously cannot have that slower growth in our interest rates are as low as they are now. this is the figure you will find in the cbo report.
there is a somewhat interesting debate among economists on which figure is you should use in interpreting the reinhard-row goff study. >> to adjust quickly respond. he did sticky through a huge debate, and one of great consequence. very confusing, i think, because of on the one hand, other hand issues that he does raise. i will give you my view, which i would argue is the correct one. let's just keep it simple. first of all, the do you believe -- who do you believe? i consider cbo to be a non- partisan scorekeeper in this town. i get my feathers ruffled when
you are in a debate with someone and you are using cbo numbers and they objected have their own. if the story here that they are telling is about the cost of borrowing is because so much public borrowing, you want to look at the rate of interest. it is the debt held by the public that matters. i don't really believe 90% very much. i do believe that we have an unsustainable budget problem and we've got to fix it. i don't care if it is 12% or 112%. what matters more is the direction. the direction a straight up unless we get our act together. we had a debt to gdp ratio of
about 120% after world war ii. 10 years later, it is 50%. it is not the level of the debt, it is the direction of the debt. i would not get wound up on any particular level. there are too many moving parts to say this level -- 81% is ok but 91% is not. it doesn't work that way. >> if suddenly interest rates were to jump on us, even a couple of percentage pois come that could translate into billions of dollars. >> exactly, these things happen suddenly and without that much warning. there is usually some kind of precipitating effect in other economies were you see this, where the market just turns around. your seeing is in european countries because they have had so many years of problems.
i want to stress that the united states is not like europe, and anyone who tries to tell you mislead you.ing to if somebody says the u.s. is going to become like greece, its debt to gdp is above 160%. the bigger problem is that greece can not evaluate strategy. it is the most important reserve currency in the world, which means everyone is rushing toward it. >> it is a great example of what i the said. if i told you that the debt to gdp ratio in greece is 50%, i don't think you would feel better about greece. they don't collect their taxes. that so many structural problems -- you know what i mean. >> you heard this a lot on the campaign. we don't want to become greece
or spain. can you explain how these trendlines will affect our economy? whether we go off the fiscal cliff or just kick the can down the road for six months, which seemed like the direction congress may be headed. >> you can generally put to economist in the room and get three opinions. there is one issue that every reasonable economist agrees on. the trajectory for our debt right now is not sustainable. at some point, and nobody knows what that figure is, you will hit some. when you cannot identify where the bond markets this side or where investors decide it is not worth borrowing at the same level or lending to the united states at the same level you were willing to lend before. the more likely trigger something like this is the u.s.
congress doing something incredibly stupid like defaulting, or a viewer to see a divergence between the u.s. economy and the emerging market economy to the point where they became better vehicles for investors, and investors might start to shift in that direction. that would be more of a slow change rather than an abrupt change. if we were to see further downgrades in the u.s., we don't know what would happen. it is possible we could see higher borrowing costs for the united states, which makes the problem a much bigger mess. as we learned last august, that lowered our borrowing costs. investors are looking for the arms of the state government to park their money. that is barely telling about where we are as a country right now, that we are still seen as the safest place to put your money.
>> if it get past the election and into november or december without any resolution of the main elements of the fiscal cliff, will there be an adverse market reaction? are they banking on certain outcomes? >> let me below provocative and then jump out. i think we will probably not careen over the fiscal cliff. the three of you can speak more authoritatively to the politics here than i can, but i view us as somewhat likely to go over the cliff. if it looks like post election, post lame-duck, january that there are enough -- talking about a plan to reverse the impact quickly, i don't think the markets or the economy will have a large, negative reaction.
the economy really does not need another self-inflicted wound, and that is what this would be. however, if we can turn it around quickly, it will not be a deep wound. like i said earlier, i viewed more as a fiscal slope worse than a cliff. -- more than a cliff. if we can reverse it quickly, we will be okay, but i would much rather we not have to go there. >> thanks for spending so much time with us. we will continue the panel. [applause] i am leaving you in good hands. >> i thought it was a balanced portrayal 40 on some of these issues here. i wanted to walk through a few other numbers in case you have not really dealt with economic
intake or slept for your high school economic courses, just to get you up to speed in about two minutes in terms of things you will see in the numbers. i think you are covering this issue, you should go and get the latest cbo report, their budget and economic outlook of day. a lot of it is easily digestible if you have followed any of this before, and it is were looking into. just buy what you might hear on capitol hill, that actually do a very balanced, fair portrayal of the issues here and is worth deferring a lot to cto because there are people there who are dispassionate in doing their analysis. a couple of figures here, if you have taken an economics course, you have seen the basic formula for measuring gdp. i include this because there is
a simple formula here that is based on arithmetic, that you have to look at. gdp is basically total consumer spending, business investment, government spending, and net exports. there is a figure for government spending in here, and when you remove government spending from the economy, gdp will go down. that is a simple, mathematical fact that at least in the short run, you cannot argue against. the argument you are hearing a lot is that cutting government spending will boost the economy. the only reason they are saying that is because they believe it will increase the confidence among consumers in the area of consumer spending and business investment, but there is a short run effect when you take out government spending. that is a critical issue to understand why the fiscal cliff occurs. if you are looking at the cbo figures, you see a recession in the first half of 2013 and a
recovery after that. you can take a look at the charts later. if you ever need to get economic data, the st. louis fed has an excellent website. that is worth looking at. the components of the fiscal cliff going over the would be a recession in the first half of 2013. there is no debate about this. there will be a recession if you go over the fiscal cliff, because you cannot raise taxes on so many people and cut government spending at the same time and not have that kind of effect. it is not conceivable that that is possible. the issue you have to think about in all this is the credit rating effect. we know that if you were to just kick the can down the road for a year, it is almost certain that
you would see further credit rating downgrades. u.s. borrowing costs did drop -- it creates other problems because it raises investor awareness about sovereign borrowing costs and the risk of government debt, not just in the united states but around the world. a credit rating cut in the u.s. i not affect the united states, but it could draw investors to look at spain and italy and realize they need to start looking more at the political risk involved in other economies. >> can you recall how much money left in the markets went just the threat of a failure to raise the debt ceiling was out there? a lot of the instability in the economy is coming from the gridlock that is here. >> it is very difficult to measure, and one of the things you will find in looking at the economy is there are so many things going on, it is almost impossible to pinpoint one
specific issue from last july and august. this card to see what par with the united states debt rating downgrade that led stocks to drop in august and september, and what part was europe, because europe was going for one of its worst times. i include this figure in here. phd economist run through the numbers and this will help you understand that there are specific cost for each individual measure. i include two of them here. you can see that every economist will look at this differently in estimating what the effect on the economy will be. the one from j.p. morgan is on the left side. it looks at the bush tax cuts expiring, $280 billion.
there are all sorts of different figures you would put in your model to come up with the numbers. how much people are setting from the tax cuts, all of those things are difficult to tease out, which is why these are all highly variable estimates. some of the figures you heard mentioned earlier, the baseline projection is currently going over the fiscal cliff. the conversion that the cbo came up with that you extend the provisions, this is a really important one. shows you what the cost of kicking the can down the road is, versus actually having a recession, which nobody wants. you would see the u.s. debt held by the public.
that is if it falls over time rather than rises. this is the deficit as a share of gdp. the goal here that you want to think about is, right now the u.s. deficit as a share of gdp. you look at the total deficit and it will last three or four years. you are trying to get the deficit down to about 3% of gdp. you want that because it is roughly in line with the growth in the economy. if you were to have your debt growing at the same pace the economy's growing, you could manage that and keep it under control. i wanted to include this because it is really a confusing chart. this is how financial markets
are trying to game out what happened over the next few months. they are all trying to determine what happened and how they should trade in treasury market, what they should do in the stock market. the only thing that matters is if you look at every single point, there are only two options. one is to be grandfathered in. the other is something really nasty that happens that we don't really know how to calculate. there are people here who know the politics of this better than i do, but this is how wall street is looking at this. they need to see a grand bargain, otherwise we will be in a lot of trouble. >> one thing that caught my year was the idea of going into recession in coming out, what is built into that calculation that we would be taking this money out of gdp? >> over time, if you were to look at what happened after the
obama payroll tax cut, it had an immediate effect on gdp. you look at the first quarter or two, you see that people somehow more money. this was the cut in the social security payroll tax. people suddenly had money, and you saw that flow into the economy. when you are looking at gdp math, it goes into the economy. the new just assume it stays in the economy. when you pull it out of the economy, you have a sudden hit and then the economy can start growing again after adjusting to that kind of shock. a risk for anyone, saying we will recover after six months, is that when confidence is this low about the political
situation. you run the risk of going into a self reenforcing downward spiral, where everyone just kind of gives up and decide if they are not going to plan to buy new car a year from now or invest in their new plant six months from now. it actually turned out to be much worse. it is very difficult to turn a recession around. what they are doing is the basic gdp back here without looking at all the other effects of problems beyond that. >> i would like to go back to the sequester. hard to explain and misunderstood. it is not all the fans. there is $600 billion in domestic related cuts abroad, but this is another aspect of
the sequester that we have to calculate. is a significant part of the politics of this. the chairman of the armed services have done a really good job talking about sequestered. it will be horrible. there will be layoffs at bases around the country. talk about what the money is and what kind of impact it may have. >> look, the democrats are eerily silent on the domestic side, and they don't really talk much about it. there is a lot of talk on the defense side, but there are groups coming out with studies. if you take the types of cuts on domestic programs, you will see hundreds of thousands if not a million more jobs leave the economy.
it will be significant. one of the reasons the obama administration keeps saying that job growth over x number of months has been consistent. where we are handling jobs is in the public sector. this would really hammered the public sector where you have a lot of public jobs. these types of cuts to trickle down to states. they don't have the kind of s,ney, and most of the state' we are seeing our property taxes climb every year now because the localities are having to figure out how to make up the money they are losing from other places. the impact on the domestic side, in some circles some people think it is far worse. the offense is awash in cash. between the start of 2001 and
women got to 2009, the defense budgets had effectively doubled. that does not include the $1.40 trillion we spent on the wars. when people say or cutting from the the defense budget during the war, you actually are not. it funds a lot of basic needs, the pay, procurement, things they want to plan for the military over the next 10 or 15 years. some the affect of this would be pretty graves and sudden on the domestic side. a lot of the funds the federal government provides to these agencies is spent more quickly. it is heavily personnel driven. personnel cuts -- on the
domestic side, there are no such exemptions i know of. that may yet to be defined. i know people are suddenly worried about furloughs and being laid off. it will have a huge impact on our economy. >> most people when they talk about fiscal cliffs talk about the bush eric tax cuts and the sequestered. there are a lot of other provisions that are worth paying attention to in here. some of them are included in these figures. the medicare cuts. they are useful ways to localize the story if you are looking to bring this to a local level. there are physicians across the country worried about the cut in medicare payments they will receive. if he were to see these take effect, there are plenty of doctors who are not accepting
medicare because they do not think there reimbursements are high enough. if he were to call your state medical association, they have people who will talk about this and doctors. plenty of them are not taking medicare any more. though obviously most still are. these have actual economic effects. if you are taking money away from the economy in this sense, there are -- there is a loss in extended unemployment benefits. congress has generally extended unemployment benefits to up to 99 weeks for people who are unemployed because the step -- we have such a huge problem of long-tm unemployment. they had been getting extended
benefits. you will see them dropping off. we are already seeing this in economic data. there are a number of ways. if you are on twitter, if you are looking for somebody brought the, start searching for jobless benefits. people identify themselves say their jobless benefits are running out. that is a good way to find people who are unemployed because they announce it on twitter that they have lost their jobs. i have used this to find people and get their stories. you can use this in that sense. obviously if you are localizing a story, the tax hikes that people will see will lay everywhere and it is worth looking in -- into. there are a number of business tax incentives that are harder to pinpoint. you might be able to try the
national association of manufacturers park chamber of commerce or state associations to get people, businesses concerned about this that have been benefiting from these tax incentives, and would see them come off. that is the debate he will see with any tax break coming off this. >> do you think you can go back to the chart that showed the scenarios? it is a complicated chart. the markets in areas. the one with all of the dots. as someone who covers congress and overseas our congressional coverage, i always think of the worst case scenario. congress either doing nothing or kicking the can down the road or doing some version of a -- economic decision with a box. coming up about that scenario?
depending on the outcome of the election. there is a lot of scenarios. if we have a status quo election, obama wins, almost an equally divided republican senate and democratic house. then there's the of republican washington scenario. i did not think there is an all democratic washington scenario right now. what is possible versus what -- in the lame duck and then into generic -- january and how to the markets react? >> it is conceivable that congress will kick the grenade down the road, figure out some way to take this problem and pushed it down for three months. that is probably a reasonable timeframe where markets will say they are trying to work towards a grand bargain, that gives them some time to come up with a bigger package.
or say six months and congress is going to try to -- if the action have statements from leaders, to come up with the biggest package of overhaul you can imagine that deals with corporate tax rates, individual rates, the jobless benefits. every piece of this and, with one giant package that you have to deal with -- and come up with one giant package that you have to deal with. that could buy enough time from rating agencies for them to say there is something there. if he were to just say let's say congress were to say economic decision, we do not want to see a recession, we will delay this for a year. that last line you see there, disciplined by the market is what they will be betting on. they will be saying we cannot make a decision until the market forces us to. this is what you're seeing in
every democracy right now. they are pushing this to the limit as much as they can until they are forced by the market. >> do you think began to a longer-term version of what we saw in five minutes on the day of the bailout? if you remember the day the house voted down the bailout, we had a split screen where the dow dropped 700 something points. and the roll-call vote -- the first time i had seen the stock market and the roll-call vote in a split screen. as it went down, the market went down. do you think we can see is stretched out version of that over all of 2013 with the market's -- if congress is unable to do a grand bargain? rest you will definitely see that in the congo -- context of the debt ceiling -- >> you will definitely see that in the context of the debt ceiling.
treasury can use it sticks to extend or delay getting -- running out of money. at some point, congress will have to vote on raising the debt ceiling. every time you get one of those votes if you continue to see the same kind of threats from some members of congress that you have already, then you will see markets running the split screen or putting this up. i am not billy sure you are going to see something like that when you just are kicking the can down the road on the basics of the budget. there is no clear trigger for what the sustainable level of debt is for the united states. you could probably push this out for a couple more years without actually seeing a market backlash but there are so many outside factors involved. if europe were to meld them robert doing that, that could
force -- were to melt down while we were doing that, that could force the judging of u.s. said differently. -- u.s. debt differently. >> in congress, this is not a congress that is working well together which is a huge understatement. we have been watching this -- the congress is so divided on these issues at this point. i have been pretty pessimistic about even a simple deal to a sequester. a perfect example is if you go to a house armed services committee hearing, it is one of the most bipartisan places you will step into in the congress these days. they are pretty close on most issues. the big fights they have are shades of gray. they try very hard to be bipartisan. they are one of the two
committees out there that actually do authorization bills every year and larsen agreed. but jeffrey zients who does not usually appear before the armed services committee showed up on august 1 and i have never seen a more partisan hearing. what happens is usually they will use the general officer or the defense appointee as the strongman to push their political agenda and those guys sit there and swallow their tongues. they are not planning a political game. except this time the republicans started to make some of these statements and then they were shocked because jeffrey zients came back and that what republicans for asserting that the sequester was the president's fault-not showing leadership, a debatable issue, he comes back and says they have a sequestered because republicans did not want to make a deal with the debt ceiling. the debt ceiling was the thing
that forced all of these other things. so it became really caustic. in a place for you do not see it, it became incredibly nasty. discolors everything. you go on to the house floor. people say anything on the floor. we know what generally the facts are but they will say anything. the senate is not getting -- it used to be in place that's a more conservative and had responsible chatter. it is not anymore. we hear things on the senate floor that is not an accurate representation but it has become so partisan. the water has been poisoned in so many ways that a lot of us feel like there may not be a deal on a sequestered jury dairy -- there may not be a deal to raise the debt ceiling. they may not come to an agreement to the taxes or they may come to a deal on the taxes backaches it down the road.
you have a tremendous debates about whether there will be a deal. there is a set of congress that says change the dates. and slip it down a few more months. keep kicking it down the road. but cr's and that kind of action comes with enormous cost. so we are talking billions and billions of dollars of destruction. there is a chance to come back in march that they may come out with a bill. but they will be diving into fiscal 2014 in february, march time frame. they may not want to take up 12 again. the major say in march we are going to another six months cr
and deal with 2014. conventional wisdom is if mitt romney wins, he runs the table and they -- the republicans when the senate theory that you are talking about reconciliation. that does not require 60 votes. >> that is on my list. if mitt romney wins and -- he will bring just enough republicans along to give them the tie-breaking vote. they can do this with under 51 votes with reconciliation. this is a really important point. >> the deal with issues in reconciliation like taxes, tax structure. it is a forum in which they can
make major changes to the budget structure without requiring what has become the benchmark which is 60 votes. if you want to bring a bill to the floor, you got to get that 60 vote special. -- thresholds. everybody loves talking about the founders these days. was designed to be this way. -- it was designed to be this way. we might have been even that more disruptive over the last 10 years if we did not have a ghost -- go slow senate. but reconciliation is putting the pedal to the metal. the party in charge could really start making some cigna began changes. they can make their medicare changes and restructure and take a whack at entitlements. also as mitt romney has said, they want to see an increase in defense spending.
they wanted high defense spending to gdp. -- want to tie defense spending to gdp. this is my expertise but in defense spending, and we spent so much more than every other country in the world. we spent probably more these days than everybody else combined on defense. everybody else. for example, we have 11 battle carrier groups were asked everybody was so frightened that china had one suddenly. it was one of the former soviet kenyan and the georgians were using it as a museum. -- the soviet union and the georgians were using it as a museum. but we have 11. so we are a very powerful military nation. even after 12 years of warfare three european nations in nato were very upset with them sometimes because some of them
spend well less than 2% of gdp on defense as required by the treaty. all this stuff has to be kept in perspective. i am very pessimistic. i do not see it passed -- a pth to them finding a way out a sequester. it is so poisoned right now. after the elections are over, the dynamics are not going to be that changed. in a lot of other ways. reconciliation -- that is what republicans are banking on. once they get to that 50 thresholds, they can really make a lot of changes. you can see by both sides are very passionate about this. republicans can get their entitlement changes.
>> one of the things i want to get into -- what does compromise like? you are used to covering a congress where republicans have taken a pledge to never vote for a tax increase. democrats are genetically incapable of cutting entitlements and domestic programs. that is why we are at the point where we are. you are pessimistic, i am pessimistic but where are the soft spots for compromise? is there a threshold, a new level of marginal tax rates? 400, 500, 1 million. is there some sort of partial sequester? is there something on the debt ceiling? a middle ground? i might be dreaming here were people salish just cut the pie in half. >> i think there is a way you could see a middle ground as a
statement of possibility. it is possible for compromise to occur that would relieve a lot of concern out there. when i talk to people in business or markets, all they are looking for is one side or the other, preferably both, to come off of their inference positions. if he were to see moving coming closer to the center on any of this, there would be a fairly meaningful purchase of time to deal with some of the larger issues. if you just keep pushing it down which i think is the base case for myself. the will find some way when they get to that end, they realize they cannot go home with nothing and they just say we will deal with this in two months and then debate it and come back to that same point again. but at some point, you will see the stock market reacting. i think this is the case where
it is not really about the debt of the deficit. they react to the recession to a writ for whatever reason, the u.s. public businesses and consumers are more sensitive to changes in the stock market than people in most other countries. when you look at stocks fluctuating in many parts of europe, they cannot really react -- you cannot say business confidence reacting as sharply as here. markets are taking a dive here. businesses are looking at markets as a signal. at the fiscal cliff approaches, the stock market was stuck to drop a little more and in force lawmakers to try to make some kind of move. a tax hike could also mean removing some of the tax
provisions in place. there are a lot of ways to do a tax hike without actually calling a hike in income tax rate. >> it boils down to just two things -- revenue and spending cuts. it is really quite simple. the guy that walked about with little tight -- it is really simple. an issue spending reductions in taxes. until they can get to a point -- and with the democrats did propose some spending cuts. they are not the kind of cuts republicans want to see. not perhaps as far as the like to go. on the other side, the republicans are -- have their backs against the wall. their electorates, the people that put them in office, kill them when they raise taxes these days. this is a self-inflicted wound
to a certain degree. they have used the tax issue as a way to politically increase their strength. and everybody hates taxes. it is a pretty easy argument to make. it used to be that under past republican presidents, they would make adjustments up and down in revenue and what were taking in. we are not getting increases in revenue now because the economy is down. the government is not taking as much. there is a belief if we can get the economy growing, that would increase revenues. the bottom line is that there are a lot of republicans who are frightened about the prospect of having everybody knows we need more revenues. you can shut down the defense apartment today and take that 600 billion off and he will not close the deficit. the deficit currently right now is over $900 million as it stands. that is fiscal deficit for the year. you can make the defense department go away. it will not even take the deficit and our spending away. not even talking about debt.
you have to have revenue on the table but it is a politically perilous position for any republican terry look at orrin hatch. -- for any republican. look at orrin hatch. eisenhower talked a lot about the defense industrial complex and saying the only way you truly get any reductions or any new planning out of the defense park -- department is simply to cut it. the republicans are applying that same policy to reduce a we need to reduce and rethink how we do things because the growth rate are not sustainable. there is a legitimate argument that seem to be accepted by all sides that it is difficult to sustain the kind of growth. there has to offer the cuts on that front.
when people are digging in, it becomes increasingly difficult to find a deal. defense is tangential. defense -- gordon adams says the fence is just a whipping boy in this particular issue. and the fat -- domestic spending will become that also although few people are talking about it. but the point of the matter is until they all accept our people are willing to take political risk, the only time that might happen is right after the election. the only time people may feel some sense of security -- house members have to start running for office almost immediately. >> do we want to be questions?
-- to do questions? go-ahead. right here. >> when you were talking about the debt to the public and a larger debt figure, who else has that debt? >> i should explain that earlier. the debt held by the public -- the big when you see, total public debt, includes the debt in intra-governmental accounts. money the government has led to itself. the debt -- gross debt. debt held by the public is basically marketable security.
>> the other question is -- he talked about democrats relative silence on the implications of the possible sequestered. could that have something to do with the fact that obama threatened to veto any changes to removing the trigger? >> it would be tough to speculate on people's motives. it is actually quite dangerous to do that. especially in my career field. but i would suggest that there is a lot of focus on -- my world is defense. i will try not to dive to deeply on the domestic side of the stuff. i can only observe that --
the are a little quiet. i tillich each side think they have a winning hand on this sequestered debate. -- i feel like each side thinks they have a winning hand on this sequestered debate. i think anybody you talk to will tell you that the programs -- many of them will never see the light of day. to be clear, we are spending money on things that will not ever fly. that will not ever be guarding the ocean. there are so many failed programs year to year in the defense department and the amount of money -- it ran into the tens of billions of dollars of spending in just the army alone in the last 10 years that led to nothing -- terminated programs. we have an f35 program.
-- this program started out at mid $200 billions for the total buy. colorado we are now at $400 billion and counting. the cost to fly this air tank over the 50 or 60 year life is now over $1.1 trillion. that is roughly twice as much if not more expensive than the planes that it will be replacing. so the cost of some of the programs of the defense program -- program pushing are still in excess of what we can afford a this point that even republicans look at that. john mccain, who has been really a strong anti sequestered by, will tell you about lockheed martin at nauseam. he's very frustrated with the f35 program.
lindsey gramm will tell you that they are against it. their dispute is with the manner in which these cuts would occur thesesequester. there really has never been a good plan that the defense department puts forth. really do these plants ever materialize if they say they will. most often, almost always the overshoot their costs so much that it is fairly outrageous the average american realizes how badly they missed. on both sides, they all realize that on the defense side, there is a savings to be found. there will be savings also wants the war -- we simply will not be spending dent and -- debt to finance the war in afghanistan. at some point those numbers will diminish, too. it is a giant mess.
it is just a giant mess right now. >> there is a constituency for stopping the domestic side of the sequestered. it is most of the progressive caucus, the black caucus, try to protect programs that would affect their constituents more heavily if you are someone in the middle who is vulnerable a lot orally, there is not a lot of political upside to sing you cannot cut domestic programs by 2% or something like that. i do not know what the polling says. if you put it in the in context-- >> if you put it in the context of medicare, if you look at the republican base, you see some of the medicare things -- that is becoming a big electoral issue for romney and ryan. and the democrats are trying to leverage this. they both are very good at demagoguing on the issue of medicare.
this is something that touches virtually everybody. when you start getting to -- everybody wants to protect their thing. >> another question in the back. >> if there is some kind of deficit reduction plan, it seems unlikely that every -- players would be willing to say we will reform the tax code, we will take on medicare, medicaid, social security. is there one element that dries it more than others that may be due tax reform but you do not use social security? >> there is a decent chance of having a meaningful conversation about tax reform that does not like the base -- best statement. there is interest all-around in trying to deal with what is obviously a confusing tax code
that does that provide the incentives that people thought it would. >> social security has a lot longer runway on solvency. there is less urgency right now on that. tax reform probably have the best chance. it isn't a lot like a highway bill or the old-fashioned approach reason bill. it becomes a free for all. they say they want to supply its but having watched congress for a decade -- simplify it and having watched congress for a decade, it is like a kid in a candy jar. i can see them at the more things -- can see them adding more things. they talk a good game. everyone could get something. it would easy to be passed. >> the devil is in the details. everyone's as our tax code is screwed up a complex and so on. you have people in the middle
class like myself loving home and make it that interest brake on our taxes and all these different things that help us we did the federal set asides for medical or daycare. things like that that help middle-class families. but people start talking about taxes, the first place they talk about taxes mostly is to either cut it or to increase it. that always tends to happen. one way or the other, they will increase its or decrease it. we start getting into the nitty gritty of what you want to do with tax code, it suddenly becomes a problem. that is where you get into these little interest. who has what interests? people fought for the different tax breaks in the system currently. bebel fight to preserve them. one of the things i think the country is probably going to have to guard against right now is if you are going to do a tax cut again, you may hope to stimulate the economy with a tax
cut, there is some data that shows tax cuts did not actually stimulate as much as we would like. but if you do a tax cut, people are very cautious now. they want to know how are you going to close our hole, our deficit then? if you're taking revenue off the table, there has to be other places breyer will increase revenue to offset because we are in a hole right now. >> i know it is neither here nor there but i am curious if you have any opinion on what affect the separate committee might have had -- the super committee might have had on averting a crisis we are in right now. what could they have recommended? >> if you look at the makeup of
the super committee in retrospect -- the were a couple of dealmakers on there. i cannot remember off the top of my head three when they put paul ryan and a couple others and some of the democrats -- it seemed like it was destined to fail. it is hard to imagine what they could get together that would have come out of their. >> i do not think anybody thought that was going to succeed. we at cq roll call, we take everything that happens in go back and forth. there were too many hardliners. it was quite obvious it was not going to be a lot of moving their this also ties into -- and
this also ties into simpson bowles. it is amazing it is being deemed the savior. it was the failure of somebody. each side has recently walked away from simpson bowles. neither side of it. the president did not take it up and run with it when the drop in paul ryan drove a stake through it almost from the outset. it was quite obvious that was not going to work. >> i am so naive. i feel like i have no is this being a journalist because i'm just like -- i do not understand. but -- what were the political benefits of setting the super committee up to fail so that we have the situation we are in right now? >> in all of these cases,
setting up a committee are deferring to some other body allows you to remove the blame from yourself and try to direct its summer house. given the opportunity where lawmakers know they are doing something they should not be doing, they will try to push it toward something else. that is why every discussion about social security and the with the blue ribbon panel. >> elections are about stark differences. it used to be the candidates would struggle to find their differences and make that nuanced argument. the two sides right now are starkly different in their approach to governance. their belief systems are completely different. this is where compromise is becoming very difficult. they are very, very different and they are doing as much as they can to show those differences. that is why the two candidates right now are seemingly running more to their base. they have to bolster their bases and the stark differences.
all these things have been done, i think, it seems to have been done to highlight their differences. >> i think we have time for one more question before we need to switch out our panel. i am try to come away with some sort of state story i can write. the more you guys talk, the more i get confused about why this is such a disaster. as you talk about the defense cuts, i am beginning to think maybe that should happen to read is the reason it is going to be a disaster because we do not have people can intelligently look at what to cut? it seems like maybe some of these cuts should happen. >> state? >> florida. the defense cut is not in my
part of the state but we would still be somewhat interesting. when you are talking about the many field programs, i am thinking lies that sort terrible? >> here is a strange talent you have. you have a general officers who are sworn to defend the natn. those general officers live with the weird balance of i have to defend the nation. i am not entirely clear about how much i'm spending on the things i'm spending and by the way, we also have to wage a war or two. and then we may be asked to go to syria or we may be needed to plan for iran or find ourselves -- it is a giant mess. a difficult job to do. you do not know how much you're spending and did you have to defend the united states. so they want more. more is better. when you're not sure what you are doing, the argument i like
to make about you have a hole in your pocket. the way you fix it is by putting more money in the pocket. it does not really work. most people agree that is a problem. but we do have a war going and our kids out there who are 18 - 26 who are fighting and there is this weird balance. then you have the past the constitution which along with a bunch of other things like ensuring the welfare of average americans, it is also there explicitly to provide for the defense of the nation. congress thinks that very wholeheartedly. -- takes taht very wholeheartedly. i do not know anybody who says the festival back and i do not know anybody who says the defense department perfectly niguel run. general officers will tell you is kind of a mess. >> in florida, you have a lot of great ways to localize this.
whether different jobs or medicare reimbursement. >> or the bases. i covered patrick air force base. up north they want to the carrier and they have it on to ships -- and a bunch of ships. that is one place for your seeing enormous growth. >> this is a nice segue into the section, if you're looking at florida, you're talking about taking roughly 8% of the army budget with no discretion. all of your ever did -- everglades projects, it is in chaos. we will discuss this. there are a lot of fun domestic ankles -- angles. i will ask you to hold a follow- up. this is a great fit with so we can transition into the last section of the same that the
journalists and how you build stores around this? sudeep, but you able to stay? everybody disagrees over a little bit. we are going to bring up kerry and richard. we have put together an amazingly rich panel for you. i hope you all appreciate this because i am of -- awed by the brainpower and reporting power in this room. marty, the one to introduce them? and we will start talking about how to develop stories. i promise you get the first question women get to that piece. >> current and former cq alum have a forum here. kerry dooley is a defense policy
reporter -- this is out of date? so you are covering up preparations for cq roll call and were the editor of cq budget tracker. city will be able to help some of the reporters here -- so you will be able to help some the reporters here. richard rubin is another congressional quarterly alum. he worked previously at the charlotte observer. you're a graduate of duke university. the title of this part of the seminar is reporting resources street now that you have had a broad overview of this complex topic, it would be great if we start talking about how to report on this.
the one to start the discussion and the end here and talk about -- or did you? >> i have some slides i want to go through. >> we will switch. >> i can start. >> and there is nothing like talking tax policy in a windowless room on a monday morning. [laughter] you can get really deep into numbers. the tricky part of it is to think about -- to understand baselines. that we start with these lines.
you can get on a lot of doorway's by people quoting you a different number that did not quite add up. one is with -- the current law baseline. here's what happens if everything expires. if the bush tax cuts expire, the alternative income tax -- all these horrible things happen. any measure everything off that. when you do that, even keeping with the way they are looks like an enormous tax cut. sometimes you'll hear democrats say we have a $2 trillion tax cut and what they are doing is comparing current law which is what happens if everything expires to what they want to do. did you have current policy. -- then you have current policy which is basically continuing everything the way it is. you just want to make sure what
you're looking at. like what the president was to do in letting tax cut at the top expire, that will then measure the tax increase because he will be compared to what is in place this year. it is important to know the difference between this to baselines because when you look at a cbo report for a joint committee on taxation report, it will look like a giant tax cut annual be confused. -- and you will be confused. the most useful resource is the tax policy center. it takes some getting used to to understand how other tables work but it will run every table for ways. current policy, and for each current policy in card law, they will run it by income,
percentile, incoming cash level. if you want to figure out what happens to the top 1% compared to current policy under a particular proposal, you can read that. if you want people between 75,100 thousand under current law, it's a different set of tables -- between $75,000 and $100,000, it is a different set of tables. in terms of sourcing -- the easiest thing to do is two directions. for individuals, any cpa will be happy to get on the phone with you and run scenarios of what might happen to typical taxpayers. h &r block has a tax institute
that will help you run some, of that sometoo. if you are trying to look not just at the aggregate. in the corporate side, there are a number of specialized corporate tax breaks that expire at the end of 2011 carried companies are working really hard -- 2011. companies are working really hard to get this extended for 2012 and 2013. that is considered part of the fiscal cliff. it is the one companies really care about if you have something in that list. if you cover companies that -- a region where there are companies that invest a lot of money in technology, pharmaceuticals, software, they care about that a ton. there are some breaks for companies that do international financing. if you're covering banks, the
air worked up about this tiny little thing you would never know is part of the fiscal cliff but is. you can look -- the joint committee on taxation has a list of expiring provisions. the go to the right side of the homepage, click on expiring provisions and go to the most recent one. you might need a little interpretation because they cannot make these things simple. but you can get some sense of who that matters to. that is really helpful resources. i caution against using irs because they have a lot of good data at your looking back. they have tons of data from 2009
and 2010. they are helpful -- their press office is helpful with there are limited in what they want to say. they themselves very much at -- as an agency that -- they wait for congress to tell them what to do and they try to do it the best they can. >> it is a good resource for demographic data. is there a -- a good resource for demographic data broken down by the types of businesses or individuals covered or the regions? >> for the business analysis, the best paper on that is a treasury department paper that came out of as the 2011. -- august of 2011.
that sort of picks apart the argument that raising taxes on people with high incomes is a tax increase on small businesses to read it is really tricky. there are two competing numbers out there in our true until they are misleading. people will quote numbers that are true and that did not tell you half the story. you will hear republicans say half of all -- the president's tax increase will affect half of all smith -- small businesses. they mean income reported on individual returns. that will be affected by the higher rate. they are right. half of income reported on individual returns would be affected by the higher rate. what is wrong with that? but is wrong about that is not all those businesses are small.
price waterhouse cooper counts. eni partnership. they're called flow-throughs because they did not pay corporate tax. oil pipeline companies. you have that set of companies. they are like employees. they are owners but he would not think of any of those like a small business. the other piece of that is we can become as side income. people who have big salaries and make money on the side from a business. so, the president. he has that $400,000 a year and book royalties which would be taxed at higher rates. is he really small business? then you have to think about
what he'd do anything differently? with his behavior change if those taxes were higher? -- would his behavior change if those taxes were higher? so those are the flaws. on the other side, you're democrats say this only affects 3% of small businesses. sure, but, it does affect a significant chunk of money for a significant number of businesses. but the treasury paper from august 2011 that is break that out and says let's lop off the big businesses, let's look at people get a quarter of their income from business and then see what the impact is. if i said it is about in between. it is about a quarter of the income generated from this tax increases that would really come from what we might think of as small businesses. there is action and no consensus definition of small business which is one of the thing that makes it hard. >> it is always done able to
understand -- valuable to understand the interest that wield a lot of power around here are the regions -- reason why there's so much resistance to doing those things. you mentioned oil companies. we know this and other oil money coming into alexas lately. they're all the different interest groups and wrestle with the stuff. they have an interest in not seeing lawyers. these are people who make a lot of money to do not want to see these taxes increase. you start to understand the picture a little better while it is really difficult to read through but understanding with the players are probably is one of the most important things you will need to do when doing your reporting. it will make clear to you a lot of the things that seem so opaque when you finally know the players are making these arguments. >> do you want to get started on what looks like a great slide show? >> how many of you have
audiences outside the beltway -- for real people? [laughter] when you get questions from friends and family are people outside the beltway, and feel sometimes that there is a lot of panic. people ask you change questions. will the lights go dark when the gulf -- on the government offices? this is not what is happening. it is not an asteroid crashing the earth. >> there is an asteroid about to crash into europe. >> this makes an excellent point and one i am not disputing but in the united states, the sequester started in this building and will end in this building. congress has put out decisions in need to make on the tax policy. the entire country is getting to know what taxes will be. on spending, a we have gone
over the sequestered and this adds to the usual way congress has been handling spending in the past two years. last year, the the the debt limit law. i always wonder if there is some -- do they get a tattoo of the bill number? everybody hates this law. nobody is taking credit for it. one thing about this law -- it is a big, ugly mess. everybody is now saying we never met for it to happen. there are pledging all these -- pluging all these programs into a big mess. it is good they are looking at it. this is not the best i could find but behind all the ceiling
-- all of this, we have some real problems. the baby boomers are starting to retire. for a long time, we had a big robust segment of the population grew to be more than it was taking out. it was fairly easy to pay for medicare and social security. that is not the case anymore. we knew that was coming. back into the 1990's, we saw bill clinton, he and the republicans work together and a budget changes. decade ago -- if you look at cbo reports, you probably only see them down on the beach in a hopeless -- rehobeth. they are predicting fiscal 2012, will be taking in about $3.55 trillion in revenue and spending
$2.91. 10 years ago they were insane the debt held by the public would shrink from the $3.4 trillion to $1.3 trillion in debt. predictions are not always worth a lot. here is what actually happened. now we're taking in to buy $4 trillion and spending about $3.60 trillion. that means we have this deficit, a gap, where we are spending more than we are taking in the debt held by the public is now about $11.30 trillion. you will hear it in every cbo report. unsustainable. i always like to look at things.
we have heard a lot about this. this is the debt to the penny. are any of you expecting to write on the debt limit at any time? do not use that term. google debt subject to the limit. it is almost the same but just enough to make your story wrong. that debt -- an interesting thing to on the point of the debt, we have the debt. we have the baby boomer starting to retire. we have congress again in the debt limit not doing a good job of it some kind of an effort sang me to address our finances. we cannot have this every year. so we have the sequester. this is the actual section of the not so beloved bill. if we go to this -- you're
supposed to calculate, start with $1.20 trillion, how much money the deficit committee is going to reduce and the reduced by inches. the number to plug in for "b" is zeo because they failed -- zero, because they failed. how hard would it be for congress to change the sequester? you could change that date. politically, they need to come up with a plan. the cover. the need to show some savings. it is a big question about whether they will be able to do that. if governor romney is elected, we will go the fiscal slope or like a cartoon character where
we will run over the cliff but kind of suspend their until midday, with a plan in polis back in -- with a plan and plunge us back. we do not believe rightabout when they agreed. last year, they got the spending bills done only about three months late but for congress is great. that is a record. everyone said, thank you, senator. there is some sign if president obama is reelected, if what ever happens, happens, these people know the available options, so there is a chance they may be able to go on. >> i believe, and i have had conversations with people in both parties who thinks
requester is the only way it is going to verdun -- to get done, but he makes the case is left with the point of not saving 2.1 trillion dollars or going into sequester, he will say, i will take a sequester. >> the senator has really done in-depth work. he has done some budget savings. how much to cut, there will be debates on that. 94 billion will have to be cut from discretionary spending. i translate into the operating expenses of the government. mandatory spending comes out of security. discretionary spending is out of
the agencies. you will hear this inside the beltway term, non-defense discretionary spending. it is always good to ask why is that. it is pretty much everything you think the government does. we were asking what would the sequestered do for florida. they have no idea what their budget figures for next year will be, so that will put them mildly conservative. there is a chance if they mess up and get the sequester, you have all these programs cut by about 8%, programs, department of education. most of it takes an 8% cut across the board. it is chaotic. they are spending at a higher level, so they will have to make cupsdeep cuts.
the federal government will shut down region will not shut down. you have scientists waiting to know if they will get grants. it is going to be a long time before nhs knows what kind of money they are going to have. for years they have been funding for one or three or four months. you do not know when they are going to finish the spending bill. we have no idea how much money they are going to spend. in the past you could take senate bills, your budget in between there. you do not know what your numbers are. you do not know if you are going to be hit by sequester. he can tell you firsthand what it is like to plan your agency budget in a vacuum. >> fiscal year starts october 1. the sequestered does not hit until january, so the first
quarter is gone, so now you are going to be talking about 11% cuts across the board as a result of the sequestered because it starts later in the year. >> does anyone know what a cr is? it is another failure. rich talk about how they failed to address the tax policies and how businesses made their decision. it is not just the thing they say about washington that they cannot plan. daysail routinely to do them on time. who knows what they are going to do bowma? resources, omb has their report. they have other reports, but the one that is due this week, that has been delayed. senator harkin has our report
with some health and education and labor programs, and he is the top appropriators for the bill that funds the department of education, health, labor, and he serves on the committee that oversees them. good i forgot to put it, and gerry mentioned scott from the center of progress. if you take one of the most important things the federal government does, and then asked agency managers how they are planning to do those things next year, you get a story. they have to tell you, we do not know how many people we can hire. we do not know if we can start new projects. if you are interested, these people have been coming to the hilt. this is some testimony from arnie dunkin.
he had really good " about how we are playing chicken with the lives of american people. i would think in october if you are not covering the elections, it would be fun to talk about this failure. >> congress will not be doing much in october. >> they will not be here. >> did you want to weigh in on any of these? the resources you used, but one thing you do very well is to have that small-business owner, that individual. how do you drill down from what we do here, this complicated rhetoric down to finding individual businesses or agencies and personalizing the stories amoun? >> that is difficult to find
people affected by this. there are a lot of things you could start with. i do a surprising amount of cold calling so i am not going through trade groups. i actually try as much as i can to go down, if i am looking for a manufacturer, i will go to the chamber of commerce and find a manufacturer on the list. if someone is serving, it usually means they are willing to talk publicly. if i start cold calling businesses, i have had some success, but they get weird about why you are calling. a very easy thing to do is find small cities. that is a good way to go about doing it. if you are trying to find regular people, it should not be that difficult. that is a case where almost
every state has a medical association. they also have regional ones that are useful. they also know people who know people and finding individuals. if you are not looking for -- if you are looking for a local , there are a lot of things you can do. if you are working for a national output, i have found the most effective thing to do is stand in front of the white house, and there are a lot of tourists who have a view on tax cuts or what ever they are facing, and you are probably going to find people from different parts of the country, and that is a different way to get anecdotes'. >> on the local story angle, a lot of the bigger stories to apply in local ways, and a lot of things would not happen if
such a thing were to occur. there is a lot of heated rhetoric around sequester. that will not lead to closures. that requires congress to act affirmatively to close bases, and they have already walked away. they have said, we are not doing that. you could do stories about military health-care. there were a whole bunch of fee increases for retirees in florida and new york and states were you have military retirees. the proposal was to see the rates increase, because they pay $425 a year for a family, and they get unbelievable coverage. that has not changed since 1995, and so you could write stories about the impact on retiree health care. there are things you could find
in the rhetoric. you will hear people who do not know. sometimes they do it intentionally. sometimes they just do not understand. there is a lot of lawmakers who do not fully grasp some of the things they are speaking about. i see it each and every day. there are lawmakers we can use and there are others who are learning. some of them are small business owners. they did not do a lot of this stuff before, and it takes a few cycles to understand what is going on in washington, even with a politician. you could do a lot of stories that ease the public concern, but on the other side, civilian military personnel, people who work for the defense department, they are not exempt. they may take a significant hit if we see sequesters.
some of them have families. they could be furloughed or lose their jobs. you could also talk to your local defense contractor, and it is not just lockheed martin, because they have suppliers who will be able to tell your the effect the sequester might have on you. some of this you could start to ask questions. most of the things you will speak with, they only see a downside with talking to you. some of them say, i can only get her to. -- get hurt. >> you will want to know how they are planning for the cliff,
whether the defense business or not, whether they have contracts or not -- to they have one of those small businesses where the owner is over 250? how are they going to react? are they worried the payroll tax cut will expire and demand and will go away? are they changing investment behavior because of that? you can really keep it open and bronzad. there is an idea of recession. you will see it with companies hiring less and investing less,
and they are starting to think about those decisions now so they can make them in december and january. >> are there particular factual traps we should all avoid when reporting on this? wrong?s everyone gets ro the first $250,000 would stay at the current rate. it is income after that. let's say you make $275,000 a year. only $25,000 of that would be subject to extra points. if you get a good accountant they can reduce it. >> not even a good accountant. when they talk about 250, the way they said that number is a was ignored buckner -- is to
ignore $250,000. that number, if you have only exemptions for the couple saw nothing, as of track those, and the income never would 3237, and a higher tax rates would apply in above that. you take accept, and the administration has been a consistent. the real taxable income threshold number is pretty close to that number. i think it is 247. if anyone wants the number, i could send you that story, because they calculated
differently. it is a non-index, a totally separate calculation. that is taxable income numbers, so you pay no additional taxes if you have got not itemize deductions that exceed standard deduction, mortgage interest, state and local taxes -- you probably will not pay more at all. it varies, so people your age, single -- say you are a married corporate lawyer in new york in an apartment you rent which no kids, you currently do not itemize, but if you have kids and are living in maryland, you probably do.
some were talking about the pledge. it is easy to fall into a trap that says they have everybody's names on a piece of paper locked in of all saying they will never raise taxes, and therefore they will never raise taxes. the way it works is republicans do not like to raise taxes, and most of them signed the pledge for two reasons. one is they are worried about the electoral consequences of a primary challenge if they vote for higher taxes, and they think higher taxes are a bad idea. even if they did not exist, republicans kilstill do not like
higher taxes. it is difficult. he still has some clout. democrats like to overstate it, because he is a convenient boogieman for the democrats, and it is a little more complicated than that. >> one simple issue is congress can do things retroactively, so the sysco cliff could hit, and you could be a month into it, and congress decides to lower tax rates, and that is something we see it as a possible thing that could happen. it is not likely. it is something we have to be careful about, because you do not want to save the entire affect will hit because it requires the full course to go through before you can use those numbers on the budget. >> there is one caveat i want to
talk about. they certainly can do that. it is really hard when it comes to the alternative minimum tax. it affected about 4 million families. this is mostly between 200,500 thousand with kids in new jersey, new york, maryland, and connecticut. for 2012, there are 31 million families triggered that is one fifth of all u.s. households that file tax returns facing an average tax increase of $2,800. that opens on january 16. you can do it retroactively a curator of the later congress those -- you can do it retroactively. the leader congress does it, the
more it affected. they have to delay filing. they would not accept the return for millions of people for a month. if they have not done that for january, you have two possibilities. one is the congressional leaders tell the irs and we will figure it out, and which is a pain because three-quarters of people get refunds, people who are counting on refunds, or they file it later. in congress fixes it, and everybody has to make 28 million amended returns. i guarantee they are pulling their hair out over the possibility. >> if you change tax rates retroactively, if you adjust tax
rates -- >> you had a question. you got laid on the last one. -- got delayed on the last one. >> i appreciate this panel breaking down stories. i have a question about how to find an expert when you are dealing with fiscal policy, because this is an art more than it is a science, and they have varying opinions when it comes to this. they can get a non-partisan approach, but there is still a debate about that. how transparent are you to your readers about the background and expertise?
>> we are trying to be transparent. most people know the people. he is very accessible and explain things for about. i find and to be very responsive. brookings, it is not impossible to get a story. >> there is a lot of homework that needs to be done when you are doing these types of stories to begin with. i would posit you should not have an interview with any of these folks until you have read because localtail, reporters are often young and inexperienced, and they think
they have found the holy grail expert. the guy or woman says something they think makes sense, and they talk to the other side, and that guy or woman is not as articulate. there are benchmarks. cbo is a good tool because they are non-partisan, but they begin the promise it is not distorted. they assume you are starting at ground zero and nothing will change. sometimes the projections will look much more dire. they provide good reading and background so you can see multiple points of view and how to those people and never assume what you have read is clear. always go to these people and bounced it off and always know who you are talking to. you are going to get a certain
type of view. , and you try to understand those people, and you build these relationships, and you start to become an expert in the area in which you are writing, so rich rubin has his expertise. there are few people who can pull wool over their eyes when they know what they are talking about. >> identify the virus of the person you are quoted. every region in -- identify the bias of the person you are quoting. everybody has bias. >> there are a number of fairly sensible consulting firms. quoted aark azandzandy lot. there are about 100 people at
moody's said do this who are trying to do an analysis of a lot of these issues. there are a number of others, depending on where you are. you will find a economists tend to be not trying to seeing you in one direction -- to spin you in one direction or another. they all have plenty of the economists willing to help you out if you are looking for something in particular. wells fargo does analysis of almost every state in the country and a fairly good ones. you can probably get more detail about how a certain budget would affect a state.
>> i understand how to get a local story, but often we pretend every dollar lost is bad. i am trying to figure out how you and evaluate when a cut matters. so much of the fence is loans. i do not want to assume -- so much of defense is loans. i do not want to assume all cuts are bad. >> strategy may change and suddenly emphasize. 10 years ago nobody thought unmanned aerial vehicles would be consuming so much defense budget, but reconnaissance became a massive need, especially as we began to understand its uses to overturn. suddenly, a bigger portion of
the empire. 10 years ago, a pilot said, we have to have pilots and planes. that is changing, because the realization is you can do a lot of these things remotely piloted. we love to throw the word cut around. a lot of times they are not actual cuts. it is a totally different animal. >> a lot of times they would be actual cuts. it is a pretty easy story to talk to people in your community. you really have a great opportunity, because you understand how poorly congress is running finances, and you have an opportunity to show it. you can say, there are programs
that are not working well, but they are not making those decisions. they are cutting everything. this is the worst way to go about it. it is great congress is making a step to fixing the budget, but it is a ham handed approach. every agency, they cannot plan. they are facing across-the-board cuts. it adds to the usual chaos they inflict on people. >> i have a quick question about 8%. where is 8% coming from? >> omb will actually decide. they had a report where they said it will be 94 billion, so these numbers are somewhat flexible. i think we have reviewed these numbers. there have been good reports done by outsiders i would
recommend, and we actually do percent until they start adding hard numbers. you can save a lot of trouble. >> when your lawmakers are telling you have to be careful, they say different numbers, and often it is colored by what the position has to be. >> i want to get one more question. >> i am a video producer, so i am wondering who do you see on the front lines? weather is the type of stafford, and who is really on the front line affected by this, whether it would calm public outcry or be part of the problem? >> i do not know one region you
cover, but to figure out the people who run some of the biggest social problems and see if they would talk to you and run through the project and see what they are going to be able to finish. it is an incredible management challenge. it is a mess, so to find somebody who has to deal with that, i do not know if you have national parks, nasa, to see if those people would give their story honestly, about now i do not know how to plan this or maybe nothing will happen. >> it will affect every program that is out there. it is at the lowest point of the budget. it is not of procurement. it is actually at this facility that makes triggers for nuclear weapons.
it comes down to the base level, and it affects personnel across the board. there are two places that would get hammered. funds that go into operating things, that goes into a significant portion. any facility that is being run, many people, and the offices of significant size, they are going to have to reconcile these things. >> thanks so much to the press foundation for sponsoring us. there are key people to thank. >> are awesome moderator, and i want to thank all of our speakers and all of you for being here today, and thank you perry much.
-- very much. >> in four weeks, the first of the presidential debates on c- span and c-span radio and c- span.org. coming up, capitol hill reporters look into the agenda leading up to the elections. then kathleen sebelius on efforts to prevent suicide. iff.the so-called fiscal cloug we will be live on 4 september 3, 1911 remembered ceremonies -- live for 3 september 11 ceremonies. at 11:00, members of congress honor the victims of 9-11 with a ceremony on the steps of the
capital, and on our facebook page, we are asking how you think the u.s. has changed since the attacks. let us know what you think. >> watch and engage with c-span as campaign coverage continues and candidates prepared to face off in 390-minute debates. domestic policy is the focus from the university of denver, while tuesday candidates will take questions in a town hall meeting, and a final debate, questions will shift to foreign policy in florida. watch the vice-presidential candidates debate thursday the 11th in kentucky, and through the election, we will also cover key house and senate races, looking at the control of congress. follow our coverage on c-span,
c-span radio, and online at c- span.org. >> this is 45 minutes. >> joining us to talk about the legislative agenda, the floor action blog reporter and jason dick. we are seeing it is only two weeks. >> monday and tuesday we will be off because of the jewish high holy day. we will come back the following week, so it is really one and a half weeks.
>> why such a short time? >> part of it is the conventions have gradually moved close to labor day as opposed to july 4. we used to have to live for the conventions. they believe if they push it to election day they can get some advantage. we have congress that really believes in keeping members back in the district, so it feels like they are rarely hear. they have been gone for five weeks, and they are going to be here for a week and a half, and they are back for another week, and then they go home for the election. and the lame duck starts when everything will be resolved. >> we have about two weeks until the end of the fiscal year, so
they have agreed to a six-month extension for the next year, and that will avoid the shutdown, so none of us will be writing shut down stories once they pass the bill. the big issues for the year would be taxes, what happens at the end of the year, whether tax levels go up or stay the same and the sequester, what happens. with the looming deadline of january, we have to start cutting. those will be dealt with in november and december. >> here is the number to call. jason dick, we are seeing some headlines about the farm bill. the n.y. times says when congress returns, it is politics
as usual and a face-off with angry farmers. what will we hear from them? >> we have not seen any suggestions they will be taking them all, but i was in missouri last week covering the senate race, and it is amazing how upen the farm bill comes with regular folks they want to reach, and there is a lot of anxiety about whether congress can find a way to get a farmville done. sometimes of farm bill is delayed a year. there are fights over it. the thought that in the middle of a relatively brutal drought there would be no farmville to take home until the election is
a little disturbing to the people who produce the bulk of the food supply. >> what type of thing are we hearing from constituents? >> it depends on what the audience was. she went to her, monster -- alma matter, and she spent a lot of time fielding biographical questions. her message is there were big differences between her and and talk a in -- and her opponent over student aid and health care, so she was trying to hammer it home. there are questions about health care. she fielded quite a few questions. there were a lot of questions about health care, some about
fema floodplain redistricting, which i have not heard was a huge topic, so it depended on the audience, but what was interesting to me is people were engaged in a variety of topics. the funding bill for the next six months did not come up that much, but i think congress is hoping they can get it out of the way and not deal with it. for me it is a colossal failure of dealing with the basic function of government and doing a flat extension that does not get you anywhere except par for the course. >> sticking with the farm bill, there is more to it than just relates to farmers. we are talking about other programs and why they are important. >> it usually ends up being a
major part of it. so much of this shows how much the spending has mattered. almost all of it comes to one issue. give people do not like that the money has gone up for food stamps, and there are a lot of reasons. every issue turns into this, and it solves. every time we look at this, how much does it cost -- that is the number one question republicans are asking. >> let's go to our phones. our first caller is robert. good morning. >> good morning. my first question is about
congress. he had congress and the senate, and he was able to pass a lot of legislation. most of that legislation was not very popular, so the second congress, and the second half under his administration was filled with those opposed to the things he passed, and that is why we have this gridlock. i think it is unfortunate we would give the president that kind of power and then to see the results, because he made so many people unhappy with obamacare and cap and trade and other things he forced through congress without any republican backing or support.
when you do that, you are going to alienate a large population of this country. if people are so angry over what he did, he will not have support, and congress will be divided because he is forcing through unpopular programs. my mention for congress would be to do what the constitution gave them the power to do, and that is to stop legislation that is bad for the country and to try to come together, but from what i can see, there is no give on the democratic side. the only way anything could come together is if the republicans
capitulates and to what the democrats' demand. >> there is so much anger, and everyone is angry. you do not see the republicans saying they can stand any tax increase, so no one is happy at all. it explains everything. it is not the clinton administration, where clinton wanted to do hillary care and suddenly the government is over. those days are gone. these are the times when everyone is taking a position. it is hard when we talk about a possible tax increase. it is hard to see how anyone gives on this issue. >> when they are in control of the house and the senate?
>> they have decided except for the spending bill that nothing is going to get done there. it would be a real feat, so this puts a lot of pressure on the lame duck. the house has been counting on going into session after the election since the beginning of the year, so there is going to be a lot of pressure to avert a sequester. the sequester came up on the campaign trail, too. , and they aware of its commo are embracing it, so a lot of pressure on lame duck.
>> how many people listening now are 82 like i am and have perfect long-term memory and remember when we had the best country in the world because everyone had a chance. do not be fooled. grover has been the spokesman for the national rifle association. we have many powerful groups in the country. i have travelled extensively through the world. in every developed country has health care. in 1996, stephen wiggins from oxford health plans soak $111,900,000 in one year and then resign. the average ceo has a tenure of two to four years.
this greed is rampant, and when they can have people like brothers, education that has a $100 million donor club, and we have the supreme court that says everybody has the right to have an ak-47 for no reason except the militia, which is our armed forces, but this is outrageous. >> you say you lived a long life so far, and you remember the best time. when was the best time? >> the best time was after world war ii. i was raised in the depression when we have 100% unemployment. >> we will look at this op-ed.
the airman and ceo, it says when businesses threatened public support for businesses and free market. let's go to the independent color in indiana. good morning. caller: i guess might issue covers democrats and republicans -- my issue covers democrats and republicans down to local issues, because one issue that has yet to be brought includes religious issues and education, and that is issues of labor, and you hear a lot of people talking about illegal immigrants, but what you do not hear about is a page on the irs
website. people are getting paid under the table that are american citizens, which is not brought up as a huge issue, but it is getting put up on the irs tax website. >> any chance congress would be taking up issues along the lines erin talked about? >> they have had several opportunities along the last few years when things were not as tense to address immigration, and they did not. it remains to be seen whether there is an appetite for that in the coming years, but is unlikely. >> park city, ill., pat is on the republican line. >> i voted for republicans last year, although i did vote for
obama, but i am kind of disappointed republicans did not do what they said they were going to do. they made all kinds of promises, and all we see is problems from congress and the house representatives and all the others, but it is very saddening to not see a lot of things past what we already have like the farm bill and other things like that, and i have one comment. please read rolling stone magazine. that was a free magazine i had, and it kind of explains, and i was kind of disappointed to hear what he was about with taking guns overseas, and i do support the unions, and i do support
farm bills, because people have to eat, but i am hoping they can come together and not have too many discriminations against supporting the middle class, because we are the people of the united states of america. that is all i have to say, but thank you very much. >> thank you for the response. >> a lot of republicans came before the end of their spring and summer session, and they were not happy either, and they ended up wrestling the government down to an almost a spending spree, but not quite. even when you do not freeze spending, there are people worried about women and children and people who rely on these programs, so there are different ways to look at it. people do not want cuts, but they also want growth in these
programs. they get in trouble for slowing the rate of growth. money is central to all these questions, and it is driving the debate, and it is the reason for everything being slow. >> the government that does nothing does the least amount of damage. why is everybody afraid? what is the danger of not acting? >> if congress were to do nothing after the election, if there were to go to the bahamas or go marlin fishing, the tax rates would spring back to the levels we were attacked during the clinton administration. it would be 39.6%. some of it would go up. the payroll tax attention would also go away.
everyone would feel that immediately. there would be more withheld for social security in all of our paychecks, and all of our domestic spending cuts would go into affect. the deficit would be cut, and this would become the big reason. every bill that comes down is framed with spending. almost every single economist is saying this is what brought us back into the recession, because people would have a lot less money to spend. you would probably go to brand x the detergent because you have less money in your paycheck as well as the people are anticipating having less at the
end of the year. even the more conservative estimates are between 1% and 3 % cut in gross domestic product. >> he was asking about spending and automatic cuts. let's have a listen at what candidates romney had to say. >> i think it was a mistake for republicans to go along with it. the president was responsible for coming out with specific changes. he has violated the law he signed. the american people need to understand how our defense is going to be so badly cut. my own plan to bring down the rate of taxation while maintaining the revenue that comes into the government is to make sure we do not lower taxes on high income people. we are not going to have high income people pay less than they do today. i do want to bring taxes down
for middle income people. i want middle income americans not to have to pay taxes on dividends and interest and capital gains. >> let's take a look at other comments made over the weekend. this is paul ryan. he is answering why he voted on these cuts. >> i was working to find common ground to get a down payment on deficit reduction. i work with president obama to get a down payment on deficit reduction. it was not a big down payment, but it was a step in the right direction. the devastating defense cuts were insisted upon by the obama administration so they would not have to face another debt ceiling increase. that is putting politics ahead of national security. i authored the bill and passed it to prevent the president's devastating defense cuts from
occurring by cutting wasteful spending to replace these defense cuts. >> paul ryan, you mentioned bob woodward, who will be our guest next monday. i want to get your reaction to the comments and also what it means for congress as they go home and deal with their vote on issues like sequestration. >> the cuts are coming because they put together a super committee, and we work to try to figure out who is going to be on it and what is going to happen, and it is over. nothing super happen. nothing happened at all. now we are stuck with plan b, which nobody is happy with. there was a lot of embarrassment that this was their grand scheme, and it ended pretty quickly, and everyone is
backpedaling. it is not surprising. no one seems to be happy with the defense cuts. there's a lot to combine in a megadeal. >> it is interesting to see the pressure begins to grow in this town. it is almost like there is a collective dream where we wake up and it is the last day of class and we have not studied or gone to class and we have this final exam, and it seems like there is a little bit going on with congress. no matter how much anyone would like to distance themselves, this was a law passed by the president. they bear responsibility to it.
there is some speculation people were rooting for the failure so they could have leverage. this is what they have to deal with, and i think they are a little bit in denial about how difficult it would be to get an agreement by the end of the year. >> they are both on twitter. go to las vegas, nev., and hear from david on the democrats' line. >> i have heard the country should allow the driving of the fiscal clift. i was wondering about the idea of romney squirming on this and
sequestration. would it actually raise revenues? what about this idea? >> there has been speculation is the sysco cliff is driven off of that this would relieve not just congressional republicans but anybody who raises taxes. now the taxes have gone up, it is just a matter of lowering them. we have no way of knowing how serious that is. it does not change the underlying problem, which is that they have scheduled a little legislative time to deal with these issues, and they are not doing themselves any favors.
they come in tune town and leave again to campaign -- coming to town and leave again to campaign. it would theoretically release them from pressure, but that is a real gamble i did not know if anyone would want to take, and it speaks to how much pressure people are feeling. >> let's talk to grab. -- brad. caller: for the deficit, my first one would be to cut a lot of the military.
as i see it, the war on terrorism is being conducted by covert operations and special drones. i do not think you need to send the military to do that. if you could leave out the military, that would save a lot of money. also, i think we need to end the war on drugs, particularly marijuana. if it were legalized, not just for medical purposes, but actually legalized, it would also increase dramatically more revenue and services in the legal places in the united states. i think if we followed the same model as alcohol about
controlling who grows it and who uses it, i think it would save a lot of money, but i know we have a big bureaucracy. >> we do not know if our guests agree with you, but we will get their response. any traction for the issues he brings up? >> a lot of people want to take it further. this is one of those issues. you have a lot of democrats agreeing. you have a lot of republicans agree.
some tend to say, let's cut everything but defense. how does it end? on the drug issue, i'm not sure we spend as much on the war of drugs. ron paul made a good bid. we saw some bills that he introduce to legalize marijuana. i'm not sure how much that would save. those ideas are out there and i do think they will be part of the mix. host: the veterans' jobs bill before the senate. guest: the senate will take you vote to take a vote by senator bill nelson to open up more avenues for employing veterans. this could proceed and we could have some action in a bipartisan vote in the house. we could see it snared up by some demands by how many amendments should be offered. this has tripped up a lot of legislation this year. republicans think they are being cut off by harry reid. a lot of legislation has ended
in a dead road. there were a few success stories in the senate over the summer. they left some amendments through and past the transportation bill and then they pass the farm bill, which is waiting for house action. no one wants to disappoint veterans in an election year. we might see a better chance for success on that. host: we have a tweet from maverick. let's get back to the phones and hear from david in houston. good morning. caller: i have an answer to part of the problem that we have with our federal government right now and that is in regard to congress. i think it is time we have term limits.
anytime you have a career member of the house or the senate, i think it is pastime. i see no where in the constitution where we were to grant careers of that length of time to a person that is supposed to be representing the people. that is too long. we have people from california to new york that have committed felonies that are serving in our congress and in our senate. we have people that get so ingrained into our bureaucracy as politicians that millions of dollars go into their spouse's banking careers or chicken of the city, people and real estate, mr. charles rangel or mr. -- barney frank. we need to have term limits. the next time they come up for election after 20 years, they have to get out of office. the reason why they would be
allowed to be in a federally elective office would be for the presidency or vice presidency of the united states. host: let's get a response from jason dick, house editor of "roll call." art they feeling like david, that the members who represent their house or senate race should be turned out because they have been there too long? guest: i think there is frustration on the campaign trail. people are upset with congress but they'll like their own congressman. that is changing a little bit, particularly in the house. the ultimate turn limit is elect them and. there's nothing to prevent people from missouri to prevent
claire mccaskill a second term. that is the ultimate check on power in term limits. incumbents to have an advantage in terms of name recognition. i did not think anybody anticipated the level of turnover that we saw in the house. the voters ultimately to have that right. california at the state level has said term limits for members of the house delegates and the senate. most people would take a glance at california and the budget situation and say that that's
-- there are several problems but term limits has not worked to make a more perfect union in california. host: "the washington post" takes a look and there is a map that shows the states that are in play. republican republicans need four seats to gain control, and six are tossups. the postal service. it was a hot issue earlier this summer. all kinds of fiscal problems. guest: we have not seen the house to anything. what the republicans want in their bill, they want to see in large part with the post office
is doing, reducing their size and giving people the incentive to leave if they have been there for a long time. the republicans get what they want by letting the postal service deal with the situation they have now. democrats are not happy with this. they're losing $25 million a day and $5 billion a quarter. in large part the republicans get what they want without doing anything. i would be surprised to see the house rush back to do this anytime. it could come back in november and december in some way. host: is this playing out politically with house members? guest: there is a true emotional connection that people have to their post offices. i'm from a rural area of arizona. the postal service was the address on my father's driver's
license. people have a real connection to their post offices. they know their postal carrier. once the cuts start to hit, if they do, you'll see a lot more people engage in this and say, you're not supposed to close my post office. just ferret out the waste, fraud, and abuse. host: we have a tweet from j.thompson. caller: thank you for taking my call.
boys. why haven't they served to defend this country? i'll hang up and let the and to be from these gentlemen. guest: it is interesting to see this increasing divide as we get further and further away from the time when we had a universal draft. we have come to rely on a smaller part of the population
to fight our wars. this puts an enormous amount of pressure on the military. people have gone to iraq and afghanistan multiple numbers of times. people know they are heading to places that are some of the most dangerous places on earth. even if people do not serve in the military, they feel the obligation. the vice president's son is a war veteran and he said this is the one true obligation that we have. the political parties are aware just how important the veterans
are to the process and to the growth of the country. they will likely be hit in terms of budget cuts if it kicks in. that is another emotional thing. that is a connection that people have to the military. if they'll are affected in some way, but could be political consequences that nobody could have considered before. host: michael in massachusetts. caller: do you think they are going to bicker? run the country like you run your household. do what is best for everybody. this bickering is nonsense. we send them to washington. we should be able to fire them if they are not doing their job.
i know people around the world are listening. you do what is best for everybody. host: is that affecting your vote? caller: i voted for obama and that think he is doing a great job. he is being blocked at every turn. we all know why. thank you for taking my call. host: gridlock. guest: it is everywhere. it is good advice. do not fight in front of the kids. they come out with posters and call each other names. there are some rules about how that needs to work. there is no jail for being a little silly on the floor. the person warn you not to do
it is coming up next and may do the same thing. on some level, this is a political platform sometimes. host: let's talk about what is going on in this seems away from the cameras. so many issues on the agenda. what is happening behind the scenes? a lame duck session and big fiscal issues. guest: they are waiting for the election to happen. then someone gets an advantage based on the result. "oh, god, "two more years of this."
everybody disagrees. the hearings are somewhat productive. they do talk when they are not on camera. that is where they got the highway bill done and the 2013 spending deal and public how to deal with the fiscal cliff. host: are their players that you are watching? guest: it depends on the chamber. i think it is fascinating. people focus on the democrats versus republicans. we have almost a coalition -- some of the far-right elements of the republican party.
for the biggest issues on the docket, you have a lot of democrats providing the margin for the house. so people like steny hoyer, republicans like mike simpson, people who have been around for a while and people who know how to get things done and get votes. guest: you will see it this week when you see the spending bill. some republicans did not like it. a lot of republicans will not be happy. you'll get some democrats to vote with it. host: bonnie, are you with us? let's move on to dot. hi, dot. good morning. caller: how are you doing? i agree with the previous caller that called about politicians being in office.
i don't think they should be able to stay in longer. all this money going out for campaigning. we should put back into the economy. they go on vacation and pass something and do not pass it. they get paid whether we get paid for not. toon't know how i'm going vote yet. i have not made up my mind. host: thank you for calling, dot.
jasonget a response from dick. guest: there is this kind of stunning realization of how much money is in politics. this is not a cynical view. that money is being poured into local television and radio stations and paying the salaries of operatives in states and paying for gas that goes into cars to traverse it states. it is the money being spent in campaigns is being used in a way that benefits a lot of local economies. that's something people did not necessarily think of. a decent bulk of that money is going into a local television
station. host: we have a tweet from james. final thoughts from you, pete kasperowicz, before we wrap up this morning. do we see tea party element alive and well? is that on the minds of congress? guest: they have a couple of weeks to do stuff and i do not think things will change in a couple of weeks. this week they will be doing spending because they have to. it will be interesting to watch. how that goes determines a lot
of next year. spending continues to be the issue. the debt is the bigger and bigger risks. bill clinton said we have to manage the debt or it will manage us. host: pete kasperowicz from "the hill," thank you so much for being here. and jason dick, thank you to you as well. >> tomorrow is the 11th anniversary of the september 11 terrorist attacks. mark begich talks about national
security. after that, mac thornberry talks about the state of al qaeda. plus, your e-mails, phone calls, and tweets. "washington journal," live at 7:00 a.m. eastern. >> coming up next, efforts to prevent suicide. economists discussed the so- called fiscal cliff. have you visited the campaign 2012 web site? from there, you can watch the campaign trail.
you can also read what the candidates are saying on major issues, like the economy, the deficit. watch and engage at c-span .org.t a wo "washington journale ." it is very good. i like how the host asks a wide range of questions. you take questions from callers. i think it helps facilitate and engage man of people at home. i am baffled that networks to not take your example. it is a wonderful program. when you cover congress, that is on filtered journalism. that is telling you exactly what
happens. it is a great channel. >> c-span, created by american's cable companies in 1979. brought to you by a public service by your television provider. >> others. this is one hour and ten minutes. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2012] >> good morning and welcome. thank you for being here. i am pamela hyde, the administrator of the substance abuse and mental health administration or samsa. each year, 11 million americans consider taking their own lives and about 37,000 died from
suicide in 2009. almost 2.5 million americans over the age of 14 are distressed enough to actually attempt this. america loses approximately 100 people every 24 hours, not to the battle of war or acts of terrorism, not to natural disasters but to the incredibly shattering act of suicide. the told a suicide takes on american communities and families is profound. keeping our nation's young people, elders, working age adults, and military personnel and their families safe from lost hope is as critical a public health issue as keeping them say from bad drinking water, tainted food, or infectious disease. samsa works toward creating a nation of communities free of substance abuse and mental illness. suicide prevention is a priority for us and mental health problems and substance abuse issues are leading risk factors of suicide attempts and completions.
the suicide rate of persons with major depression is eight times that of the general population. over 1/3 of individuals who died by suicide of a blood alcohol level over the legal limit. samsa has a lead role to find solutions for these health issues but across our initiatives and through our collaborative efforts and among our partnerships, many have been key players but three step want to call out -- richard mckeaon, marybeth and jim galloway help to develop the report you here today. kathleen sibelius and our surgeon general have been instrumental in this. they are tremendous partners in the urgent task of preventing
suicide. the centers for medicare and medicaid services have stepped up to provide screenings and quality measures, in ovation awards, training, and soon to be informational material to help people with behavioral issues receive the help they need. we're joined today by these individuals and by numerous other federal and state agencies and departments, some of which you will hear from today as well as by a tremendous private sector leaders on health, education, business, philanthropy, and advocacy. i want to thank you all for being here. we are joined in our efforts by survivors, people who have attempted suicide, lived to regain hope and recovery and families of those who have
attempted or died from this significant help -- public health issue. they are the reasons we are here today. today we acknowledge the commemoration of the 10th world suicide prevention day and would begin day two of national suicide prevention week. we're also a little over a week into national recovery month. we raise public an awareness across the country that people can and do recover from substance abuse and mental illness. addressing public health issues such as these, meeting them head on and finding lasting solutions is something my boss is well known for. secretaries of bilious has been a leader on health issues for more than 20 years and now she is leading us to a profound transformation of american health care system, focusing on prevention, quality, and the highest value health care possible for all americans. she is up to the test to make the most of every opportunity created by the affordable care act, ensuring parity for those with behavioral health issues along the way. it is my great pleasure and honor to introduce to you today, secretary kathleen sibelius. [applause]
>> thank you, pam, for that nice introduction but more important, i want to thank you for the incredible leadership at this historic moment. i want to thank all of you for joining us at this important event and our partners at the table who you will hear from. this strategy would not have been possible without the important partnership of many leaders here today from inside and outside government. i want to join pam in acknowledging a few people. the surgeon general, the director of the suicide prevention center. former senator gordon smith and secretary of the permit john mchugh for their tremendous work at the national action alliance for suicide prevention and all the private-sector
leaders here today including the ceo of bell you options and marnie levine from facebook. two great health leaders and our department, pam hyde and jonathan blum have contributed so much to this important work. we are here today because we all have a role to play in preventing our friends, family members, colleagues, and neighbors from reaching the point where they think there is no hope and they take their own lives. that work has never been more critical than it is today. in the 1990's, we sell a slow but steady decline and the number of americans lost to suicide. since then, suicide rates have begun to rise again. today, suicide is the third leading cause of death for young people ages 15-24. we have seen especially alarming trends in our armed forces. just this july, the army lost 38 soldiers to suicide, an all- time one-month high. these are heartbreaking because they are preventable. that is why two years ago today, defense secretary robert gates
and i launched the national action alliance for suicide prevention. under the leadership of senator smith and secretary mchuggh, the lines brought together advocates from private and philanthropic sectors, health care providers, public officials, business and faith leaders and other federal departments and the armed forces. together kobe help shape a new strategy for suicide prevention that acknowledges the specific roles each part of the community can play in preventing suicide. we tried to identify the areas where collaboration can actually make the biggest difference. already, the action alliance has galvanized over 200 leaders in the pro -- public and private sector to join forces and do their part in fulfilling the alliance goal of a nation free
from the tragic experience of suicide. as private partners step up to the plate, our department also is committed to doing our part. today i am proud to announce nearly $56 million in new grants to support the national strategy. as part of the ^ lee smith immoral act, named for senators met's son garrett, these grants will help expand suicide prevention efforts. our department continues to support the national suicide prevention lifeline and to partner with the va on the crisis line. these call in line to allow people all over the united states and some overseas locations to call at any time, day or night, and get help and they need it. finally, we want to make sure that suicide prevention is part of our broader efforts to
improve health care across america. for example, a couple of weeks ago, the centers for medicare and medicaid services announced new standards that doctors will have to meet to earn certain incentive payments. we made sure that providing people who have major depression with suicide risk assessment was included as one of those standards. beginning last year, medicare also began covering an annual preventive screened for depression which is especially important since older americans have the highest rate of death by suicide. in the past, we have often treated mental health or substance abuse as personal issues. individuals must overcome these on their own or with their family and health care provider. by addressing these conditions, and recognizing they are just as important to our country as
that is why this strategy contains information about how each of us can actually make. a make it starts with reducing prejudice against and the misunderstandings around mental health issues. it also means having the courage to ask important questions to anyone showing signs of distress. are you thinking of heard yourself? that simple act and start a conversation that can actually save lives. we have a long way to go to achieve our ultimate goal of a nation free of the tragic experience of suicide but thanks to a focused strategy and all the partners who have committed to implementing it, we have a clear road map for getting there. now i would like to invite to the podium, the former senator gordon smith. the senator and family have been personally touched by the tragedy of suicide. many people have turned away, but he has decided to actually use their tragedy as a way to inform and involve a major other families are not touched by the tragedy. since garrett died, he has been one of our greatest leaders in and out of congress in trying to prevent the tragedy happening to other families. i am pleased to welcome to the podium, senator gordon smith. [applause] >> thank you madam secretary for your very thoughtful words. i can't thank many people but i would rather focus on the substance of what want to say.
i must thank secretary mchugh. he was my college -- my colleagues in congress and he is the public sector leader of suicide prevention. he is more than an equal partner. he has a huge task. there are others i should be thanking but i don't have time to name new but thank you. it was nine years ago plus two days that my wife sharon and i receive the news of my son's suicide despite the overwhelming sense of grief and the endless flow of tears, i saw something quite remarkable in the united states senate.
it was so remarkable that it even made its way across to the house of representatives. we found an issue, the issue of mental health and suicide prevention, that does not have a partisan affiliation. it is an issue that registers with humans and not republican or democrat. what we saw with the passing of the garrett lee smith memorial act is americans united trying to help what is an entirely preventable medical tragedy and that is suicide. today, we are re-launching a national strategy for suicide prevention. so much good work has gone into
this from so many organizations which before or light blue sense of their rope that had frayed. they are tied together now in this strategy. our goal is that in the next five years, we will save 20,000 human lives. through all these efforts, we can easily calculate $1.5 million of time and contributions from private individuals and public individuals. we have also been funded by the federal government. we recognize that the budgetary situation of the federal government will put great pressure on their ability to continue to help us so i call upon individuals, philanthropist, and corporations who care about this issue and you should care about this issue because this issue touches virtually every family, certainly every neighborhood and every community in our great nation. it is something we can do
something about the worth of souls is great. join us in this goal. it is the work of angels. i thank you for your time and i'm very pleased to turn the podium over to scott gould, the secretary of affairs. [applause] >> thank you for that kind introduction and for all of your work and leadership in this area. i know it comes from the heart. the veterans administration has been an active partner in developing the national strategy for suicide prevention. over the past four years, we have been grateful for the president's strong and decisive leadership for veterans and particularly for his support to improve mental health and reduce suicide. we're fortunate to have over 20,000 mental health
professionals working at va. our budget has grown by over 40% in the past four years and we believe we are providing innovative and leading edge care in more than 900 locations across the united states. last week, president obama issued his historic executive order to further improve mental health services for veterans, service members, and the military families. it includes a hiring initiative of an additional 1600 mental health professionals, a 50% increase in the individuals who man the crisis lines 24/7 and a new campaign call "stand by them."
we know that va care and the crisis line networks. our system is the best in the country. six -- since its inception, one element of that care system called the veterans crisis line has received more than 655,000 calls. we have made over 93,000 referrals for care and we have rescued nearly 23,000 callers from potential suicide. history shows that the cost of war will continue to rise in the coming decade. increasing the need to provide more mental health care that our veterans have current and they clearly deserve. we have learned from that experience that we still missed many opportunities to prevent suicide if only we had someone in care earlier in the process. time and again, after a suicide, family members, co- workers, friends knew that something was not right or that the veteran was having difficulties but they did not recognize the warning signs or they did not act on them or they were unable to convince that individual to seek help. let me give you an example of when this process works right -- a
the veterans crisis line got a call recently from a veteran to mother who was several states away from her son and she knew something was wrong. it might have been mother's intuition. he was a post-9/11 veteran who had trouble adjusting to civilian life and she could not reach him. she had reached out to his girlfriend who had recently broken up with him. she had received an e-mail that were read part that he was considering killing himself. she wanted to travel. she thought she got in a car, she will not get there in time. she did something we want you to consider doing here today. she picked up the phone, called the veterans crisis line as a family member and said, "my son needs help." @ cravaack spinelli trained individuals use their network to -- that group of trained individuals use their network to get to him. today, he is alive. he is engaged in care at a va and involved as a coordinator
at his va medical center. we need to help people recognize that something is wrong and know what to do with that in sight. there are thousands of success stories like this made possible by the veterans crisis plan and va system of care but we have much work to do. we have learned and that it will take all of us. it will take folks and vqa, dod, the community health providers, the family and friends and the employers and co-workers and neighbors of faith based organizations and veteran volunteers to make a difference for service members and veterans transitioning back into their communities. you can help. recognizing the warning signs that someone is having trouble and knowing where to turn to help will save lives. today, va is releasing a new public service announcement call "side by side" focused on the important role of family, friends, and community have
been supporting veterans who may be in crisis. let's take a moment together to take a look at that video. [video clip] >> we used to get together every week. she has been home from her last appointment for months now and i have not seen her once. >> he has been different since he got back from iraq. one minute he is ready to go and the next to does not want anyone around >> the nightmares are back and seem to be getting
worse. shouldn't he be sleeping better after all these years to >> a lot of people don't understand what veterans go through during service when they come back, that's ok. not everyone can help. >> you stood by us when we were in uniform. stand by us now. >> my brother would not take no for an answer. >> like my wife did 20 s three question >> like my friend when she needed the help. >> stand by them, they stood by you. visit veterans crisis long.net. >> there you go ,the va is here to help veterans and family and friends to reach out to the people we love and treasurer and we urging everyone here today, community-based
organizations, veterans service organizations, health care providers, private companies, and other government agencies to connect veterans to our veterans crisis line. here are the numbers -- i thought i would never live to see if they were i look into a tv camera and say you need to call this telephone number if you see or know someone who is in crisis 1 ---800-273-8255 and a press1 or you can join us online at veterans crisis line.net or by text message and 838255. working together, leveraging our reinforces, we can stand side-by-side to prevent suicide. as a matter of hope and care adult community action. it is a privilege va to be part of this national alliance to combat suicide in america and it is now my great honor to introduce the secretary of the armed ,john mchugh and the public-sector co-chair of the action alliance. [applause]
>> thank you. thank you very much. please extend on all our behalf our words of appreciation to secretary shinsecki. i know secretary panetta would want me to express our deepest profession -- rather our deepest gratitude for our cooperation. 98% of the people in this room are doing -- are due a great deal of thanks. i will say that on a personal level the hours ahead. i want to particularly thank my co-chair and partner and my former colleague and my good friend, gordon smith. as you have heard, sometimes the statistics, of this weighty
issue, can stand large before you. it is always helpful to remember the human element. looking at senator gordon smith, understanding his family, brings it all rushing home. we'll strive to have a small part of passion that he has shown in trying to make a difference to this thing. it is a terrific honor for me to have the opportunity to work beside him. to all the good folks at this table, particularly secretary kathleen sibelius' along with secretary gates helped us put this on a path to success ms. donegan and ms. levine, thank
you so much for what you are doing. i remember very clearly just a few years ago, two short years ago, secretary sibelius and secretary gates launched with this effort. i don't know that all of us believed we could come this far in a relatively short 24 months but here we are we are announcing the completion of one of the most important goals that was outlined in that seminal day in this very building two years ago. it is the updating of a national strategy for suicide prevention. i want to underscore the importance of this effort. think how far we have come since the last time in nationalists -- strategy for suicide prevention was put forth.
byarnie're joined m living from facebook. in 2001, when that strategy was last offered, someone asked about facebook and i started looking for a photo album. today, not so much. we truly have seen so much difference in this world and so many things changing. perhaps the most difficult change, the most change came in that short period time since 2001 and that is also people we have seen, loss of promised they. head since that year, more than 356,000 americans, 356,000, have died but their own hands. to put that into perspective, that as more people than live in the great city of new orleans. despite all our efforts, all our best efforts, 100 more americans will likely take their lives this very day. one of them is likely to be a soldier. one reason i am proud to serve as the co-chair of this alliance is the fact that also have a high honor of serving as the secretary of the army. in the army, we consider ourselves an institution that makes every effort to instill and its members something that to us is very important,
something we call the order itos. it is a code of soldiers live by. it teaches them never to accept defeat, never to quit, and most importantly, never leave a fallen comrade behind. at this time, right now, today, we are losing more of our soldiers to suicide then we are to combat. in a real way, we feel somehow we have left those fallen comrades behind. it is easy to assume in the military at or that it is the things that's around, but, the repeated stresses of deployment and the time you are with her family and the perils of conflict. those are not the sole reasons why those lives are lost. like so many other suicide contradictions, the reality is far more complicated. in fact, the department of defense completed a three-year study that shows that 54% of those in our ranks in the military who committed suicide
in 2010 and 59% of those who attempted suicide in that same year never once deployed. 89% of those people never saw combat. what that tells us clearly is that we are dealing with broader societal issues. there is substance abuse, financial distress, relationship problems -- the order -- these are the risks for suicide in broader society. the army has dedicated a great de of resources and effort into our own studies on suicide prevention, intervention programs. you heard secretary gould note the partnership between military and dod. we think all the people of this nation will benefit. this type of continued
collection -- collaboration of public and private sectors from all walks of life, this is where we see the real benefit. as suicide knows no, race, age, gender or economic status, a successful prevention and intervention efforts have to cut across the entire fabric of our society. that is why it we'dd in aod and
me personally have been so thankful to be a small part in this process. more importantly, to see the great achievement that we are unveiling here today. this national suicide prevention strategy will help each and everyone of us, help us to work better together, advancing goals and objectives to help alleviate the most preventable of mankind's afflictions.
nothing is more fundamental to our success than communication, reaching out to those in need of guidance or support, especially the socially isolated, listening to anyone in a friend or mentor and changing the public conversation on suicide intervention and prevention. improving communication efforts me recognizing that how we communicate, how we reach out, how we intervene has changed, the vault, and improve. by utilizing the communication tools, keeping pace with emerging technologies and creating innovative interactive programs will not only more effectively and immediately
help those in need but also involve more people in communities in reaching our goals. there is no question that one of the leaders in that effort has been facebook which is why we and i did, in particular, and pleased to introduce our next speaker, the facebook vice- president for global policy, marnie levine. [applause] >> thank you for that introduction. thank you to everyone here for your leadership and work on this important subject. every day on facebook, people share millions of georgia's. moments we see celebrations, reunions, anniversaries, and engagements. we see an infant's first set, a happy day at the beach, traveling to replace for the first time and sharing that with somebody. these are the happy moments of life. these are the ones we really want to share and c. life, unfortunately, is not always filled with happy moments. the information that people share and social networks is not always just about being happy. sometimes people turn to social networks in their most vulnerable moments. sometimes, social networks are in place where people express their deepest insecurities, disappointments, feelings of loneliness, or despair or even worse. this is a simple truth and a time more social networks have become a reflection of the
fullness of our society. they do not just reflect the happiness and. joy the refect -- they reflect the full complexity of life. since facebook is the place where people live on line today, it is not just an opportunity for company. means we have a special responsibility to our users. we need to provide not just the tools and features and environment for those who come to facebook to enjoy moments of celebration but we need to be there at our best in times of crisis. that is why i am honored to be here today, participating in there-launch of the national strategy for suicide prevention. we're happy to collaborate in this difficult time. the national strategy will help ensure that the latest research and technology will be put to full use to better support those in distress. those twin objectives -- utilizing research and utilizing technology -- mirrored the affected we take at facebook. when we began to be confronted
with reports of suicidal content on the site, we realized we needed to do two things -- we need to engage in with the community to respond to these situations and we need to use the power of facebook itself to mobilize friends and counselors to communicate and intervened with the person at risk. at facebook, nothing is more important to us than the safety of our users. we hope that by harnessing the power of social network and the crisis support from our suicide prevention partners, we can prevent suicide across our community. as a pro partner of the national action alliance in the past few years, we have established strong relationships that have helped us and others in handling these difficult situations. the alliance has shown that
partnerships can offer the best place, the best help, where it is needed most. our longstanding relationship with the national suicide prevention lifeline has enabled us to provide intervention assistance to people in distress. last december, we were proud to launch the latest feature with lifeline -- leveraging private sessions with counselors. when a facebook user is identified by friends as being in distress, that person will
receive a personalized message from facebook containing a link to begin a confidential chat session with a professional crisis worker at lifeline. this important tool brings instant intervention counseling to those who need it when they needed. during the first week of the program, a teenage girl who was contacted told a counselor that you have no idea how many lives this could say. we also developed another feature on facebook which enables people in distress to use our report function to get support from a trusted ally. if you look at the facebook site, we have links on each and every page. by clicking on the report of link, you can message to your friends, a parent, or co-worker or some other trusted figure in your social network. alternatively, you can report the content directly to facebook which is then reviewed by our safety team. by helping people connect to the community of support, we hope to be able to enable people to get the help when they needed. facebook is taking additional steps to prevent suicide. while there is no community that is immune to the tragedy of suicide, there are some at risk communities that face